Thursday, September 10, 2015

New Texas Law Aims To Minimize Contract For Deed Ripoffs; Provides That Recording w/ County Records Office Effectively Converts Contract Into Deed Of Trust That Requires Formal Foreclosure Process When In Default

In Weslaco, Texas, The Monitor reports:
  • Representatives of several nonprofit organizations held a news conference this week to announce legislative updates to the deed contract law in Texas.

    On Wednesday, members of the RGV Equal Voice Network’s housing working group and its network partners, Proyecto Azteca(1) and Texas RioGrande Legal Aid,(2) met at Affordable Homes of South Texas in Weslaco announced that buyers will now have legal ownership of their property should they file the contract with their county’s property records.

    As it worked before, the seller retained legal title to the property until the balance was paid.

    Citing additional protections for rural residents in Texas who purchase their land via contract for deed, it was further stressed at the press conference that because there are many families in the Valley who would not qualify for a conventional property loan, “they find themselves with no other option than to enter into a risky rent-to-own agreement.”

    The changes went into effect on Tuesday, Sept. 1, and also allows for buyers to apply for tax discounts. Also, the date in which a contract is signed cannot prevent it from acting as a warranty deed so long as it is filed with the county.

    This, according to TRLA representatives, may also ease refinancing opportunities and also requires the seller to undergo a formal foreclosure process if buyers fall behind on their contracts.

    “Under a contract for deed, a buyer makes regular payments to the seller (property owner) until the amount owed is paid in full or the buyer finds another means to pay off the balance,” read a press release issued by Amber Arriaga-Salinas, public relations director for Proyecto Azteca and press officer for the Equal Voice Network.

    “It is a huge step forward; if you have a contract for deed you can just file it at the courthouse and it automatically becomes a deed of trust,” said Proyecto Azteca Executive Director Ann Williams Cass, who also serves as chair of the Equal Voice housing working group.

    Residents who have a contract for deed can call the TRLA office at (956) 393-6220 to learn more about their rights under the new law.
Source: Nonprofits stress state contract for deed law’s new protections.
---------------------

(1) Proyecto Azteca is a nationally recognized, community-directed, self-help housing organization that has financed and trained more than 600 families in the construction and first time ownership of their own homes in over 150 Hidalgo County colonias (isolated rural unincorporated communities characterized by third world living conditions).

(2) Texas RioGrande Legal Aid (TRLA) is a non-profit organization that provides free legal services to low-income residents in sixty-eight counties of Southwest Texas, and represents migrant and seasonal farm workers throughout the state of Texas and six southern states: Kentucky, Tennessee, Alabama, Mississippi, Louisiana and Arkansas.

Links to this post:

Create a Link

<< Home