Legal Question in Credit and Debt Law in Texas

We purchased (owner financed) the house 10 years ago for $100,000, and the balance is around $89,000. We also owe $6000 in property taxes on this property. The house was owner financed because it couldn�t pass inspection for a bank to secure a loan. The home had serious foundation issues. We approached the owners in person and told them about the circumstances pertaining to the property, and that we would like to sign the house back over to them for the amount of the past due property taxes of $6000. They saw a lawyer soon after our meeting, and they have begun foreclose proceedings on the property. They are going to let the property go to auction and seek a judgment for us to pay the difference. We own two other properties a condo we reside in and a house Friendswood that has renters. We have minimal equity in the condo, but we have about $55,000 of equity in the house in Friendswood. Can they touch savings or checking account? Can they place a lean against the Friendswood house since it is an investment property? Can they touch any of our assets? Will this foreclosure be reported to the credit bureaus?

Thank You,

Shawn Bawden Sylvia Bawden


Asked on 6/17/10, 9:41 am

1 Answer from Attorneys
Mark Dunn Mark D. Dunn

The house you live in is homestead, and can't be attached to satisfy a judgment.

The judgement creditor CAN seize the house in Friendswood. In the alternative, he can ask for a turnover order so that the rent payments go to him instead of you.

"Investment property" isn't a category of exemption.

Yes, a judgment creditor can garnish a checking account or a savings account (I've done it myself, in fact ... in Harris County).

Yes, the foreclosure will probably show up on your credit report.

All this being said: You should go to a real estate lawyer and show him the paperwork for the financing of your house, and let him give you some advice about the foreclosure itself.

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Answered on 6/17/10, 1:02 pm


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