Texas Real Estate Laws Every Seller Should Know
Texas auctions foreclosed homes on the first Tuesday of the month, gives you two short notice periods before that, and charges no transfer tax at all. Here is what generally applies before you sell, in plain language.
Before Any State Clock Starts: the Federal 120-Day Rule
Every state timeline on this page sits behind a federal one, and it is the single most
useful thing to know if you have missed payments. Under
Regulation
X, 12 CFR 1024.41(f)(1), a mortgage servicer generally
“shall not make the first notice or filing” required for a judicial or
non-judicial foreclosure unless the borrower's mortgage loan obligation is
more than 120 days delinquent.
That is roughly four months of missed payments before the state process is even allowed to
begin. It is why a state sequence that looks alarmingly short on paper is usually longer in
practice than the statute alone suggests.
The exceptions, because they are real. The rule does not apply where the
foreclosure is based on a violation of a due-on-sale clause, or where the servicer is joining the
action of a superior or subordinate lienholder. Small servicers are not exempt from this
particular prohibition. Loan types and servicing arrangements vary, and some loans are outside
Regulation X altogether.
So treat 120 days as the general floor rather than a guarantee, and work from the dates on your
own paperwork. If a notice has arrived and you do not believe you are past that point, that is a
question worth putting to a HUD-approved housing counselor or an attorney before you do anything
else.
The First Tuesday Auction, and What Has to Happen Before It
Once a Texas foreclosure sequence legally begins it moves fast, and that is worth understanding
precisely rather than as a headline.
- Your servicer sends a notice giving you at least 20 days to cure the default
before notice of sale can be given.
- At least 21 days before the sale, notice is posted at the courthouse, filed
with the county clerk and mailed to each debtor obligated on the debt.
- The auction happens on the first Tuesday of a month, between 10 a.m. and
4 p.m., at the county courthouse.
Those are the final two steps, not the whole story. Both periods are floors,
not maximums, and for most federally covered residential mortgages the federal 120-day rule
described above sits in front of the entire sequence. So the 20 and 21 days are what happens at
the end of a much longer process, and a page telling you Texas gives you six weeks of warning from
your first missed payment is describing something that generally cannot happen.
One detail that catches people: the statute treats notice by certified mail as served when it is
posted, not when you receive it. If you have been away, or mail has been going to an
old address, you can be further along than the postmark suggests.
Official source: Texas Property Code §51.002
After the Sale There Is Generally No Redemption. Unless It Was the HOA.
This is where Texas differs sharply from many states, and it is the reason timing
matters more here. After an ordinary mortgage foreclosure sale in Texas there is generally
no right to redeem. There is no months-long window afterwards to buy the property back.
Act before the auction, and do not assume a meaningful post-auction window exists.
The significant exception is a foreclosure by a property owners' association
for unpaid assessments, where a redemption right of up to 180 days generally
applies for a residential homestead owner. Those are different proceedings with different rules,
so the first thing to establish is who is foreclosing.
Where a sale produces more than the debt, any surplus is what remains after the debt, costs and
other valid liens are satisfied, and junior lienholders are generally paid ahead of the former
owner. Excess proceeds are typically deposited with the court, and claiming them is a separate
process with its own deadlines.
No Transfer Tax, but Property Taxes Are the Carrying Cost
Texas charges no real estate transfer tax. Most states take a percentage of the
sale price when the deed is recorded. Texas does not, so that line simply is not part of your
arithmetic here, though recording fees and the title insurance premium still apply. On a sale to Eagle, we pay both.
What Texas charges instead is property tax, and it is among the highest in the
country because there is no state income tax. That matters for a decision rather than as trivia:
the monthly cost of holding a house you are trying to leave is a real number here, and it is
usually the figure that decides whether waiting is affordable. Look at your own bill rather than a
statewide average, because rates vary widely between taxing jurisdictions.
The seller's disclosure notice, and who is exempt. Texas generally requires a
seller's disclosure notice, and the exemptions cover much of this page's audience: transfers by an
executor or administrator, transfers by a trustee in a foreclosure, and transfers between certain
family members are among those excluded. Exempt is not permission to conceal a known defect, and
whether your transfer qualifies is a question for a Texas attorney looking at your paperwork.
Closing. Texas closings run through title companies rather than attorneys as
ordinary practice, which is one reason a clean Texas file can close toward the shorter end of our
range.
Official source: Texas Property Code §5.008, seller's disclosure
General information, not advice. This section describes Texas practice in general terms and was checked against the sources cited in September 2026. Laws, timelines and local procedures change, and how any of it applies to your property depends on facts we have not seen. It is not legal, tax or financial advice, and it is no substitute for talking to a Texas attorney, accountant or HUD-approved housing counselor about your own situation.