Texas constitution section 50
Have you tried to sell your home and only then learned that Palisades Collection, from New Jersey, slapped a judgment lien on your homestead? You're not alone. By my reckoning, Palisades slapped thousands of liens on Texas homesteads over the past ten years. The liens are usually not valid since the Texas Constitution doesn't recognize judgment liens as valid on homesteads. However, I notice that many of the liens are in the sub-$3000 range, and I'll bet lots of people just decide to pay up at closing rather than fight a lien they don't understand isn't valid. If you have a Palisades lien on your home, call me to discuss.Content may continue . . .
Under important recent cases in Texas federal courts, there's no statute of limitations on bringing a lawsuit to confirm that a home equity lien has been invalidated by lender misconduct under Tex. Const. Art. 16 Section 50. However, a very recent case indicates that as to the companion penalty under Section 50, forfeiture, there is a four-year statute of limitations. Therefore, if a lender fails to cure a Section 50 defect, it not only loses the lien on a home; it not only loses all future payments from the borrower. It also loses as much as the previous four years of payments, which it must pay back to the borrower! Content may continue . . .
Since Texas home equity loans are "no-recourse," which means that a lender may not pursue a borrower for any deficiency following a foreclosure sale, why doesn't everyone who worries that defaulting on their home loan could threaten them at some point in the future go out and get a home equity loan? Borrowers acting in good faith would never be on the hook for a deficiency judgment if they default!Content may continue . . .
HAMP Trial Period Plan (TPP) Agreements May Violate the Texas Constitution in the case of Texas home equity loans
In the appeal of the federal district court dismissal of the Pennington class action, the plaintiffs whom I represent are arguing that HAMP TPP agreements violate the Texas Constitution's homestead provisions insofar as the TPP agreement creates an express schedule of payments that is insufficient to pay all interest and principal coming due each month. This blog post is a REDACTED, SUMMARY section of the plaintiffs' brief in Pennington. If you have a Texas home equity loan and made payments under a HAMP TPP agreement that put you further behind on your loan, you should read this material. I have removed all citations to case authority, representing a hundred hours of work, but if you have retained counsel and are facing these issues, have your lawyer get in touch with me.Content may continue . . .