RIGHT OF REDEMPTION

Your Right To Redeem The Property After Foreclosures  

As stated above, there are three types of foreclosures in Texas (tax foreclosures, HOA foreclosures, and bank and mortgage foreclosures). Your right to redeem a property under each type of foreclosure is also different. To make matter even more confusing, your right to redeem, depending on whether it is a single family residential property or a condo and whether it is a homestead property or an investment property also affects your right to redeem, as well as the amount of time you have to redeem such property. Obviously, you should do all you can to avoid a foreclosure. However, there may be times when you may not be able to avoid foreclosure. What then? What are your rights? The Houston Foreclosure Attorneys and the Houston Real Estate Redemption Lawyers at the Law Offices of Steven Tuan Pham will counsel you on your rights of redemption and assist you in the process of redeeming your property. Depending on the market value of your property and the purchase price by the subsequent owner, it may worth your time and effort to speak to one of our West Houston Real Estate Attorneys. Please call our office at 713-517-6645 for a personal consultation.

In Texas, a homeowner whose property is foreclosed on by a bank and mortgage company does not have the right to redeem such property. On the other hand, a homeowner whose property was foreclosed on by an HOA and sold or whose property was sold at a tax foreclosure sale may redeem the property, depending on the type of property and whether such property is intended as a homestead or an investment property. Section 209.011 of the Texas Property Code affords homeowners the right to redeem the property after an HOA foreclosure sale. A homeowner of a residential property that is a single family unit may redeem a property sold as a result of an HOA foreclosure within 180 days after the date on which the association mailed the notice of the sale. The owner must pay the subsequent purchaser the full foreclosed price, attorney’s fees and costs, and pay 25% above of the sale price. A purchaser of an HOA foreclosed property must not encumber the property or sell transfer it to anyone other than the homeowner within the 180-day period.

Under the Uniform Condominium Act, Section 82.113 of the Texas Property Code, only the owner whose property is intended for residential purposes may redeem the condominium unit within 90 days from the date of the HOA foreclosure sale. In other words, investment properties cannot be redeemed after the Association foreclosed on the property. The Association may bid on and purchase the unit at the foreclosure sale, take a deed in lieu of foreclosure (nonjudicial foreclosure), or file suit to recover a money judgment for the lien and assessment of the property. To redeem the property within the 90-day redemption period, the owner must pay the purchaser the sale price plus any reasonable attorney’s fees and all costs associated with the foreclosure, and the sale and purchase of the property.

The owner’s right to redeem the property under a tax foreclosure is also limited, but the code allows a much larger window for such redemption. An owner of a residential homestead property, or agriculturally designated property, may redeem the property within two (2) years from the filing date by the subsequent purchaser. To redeem the property, the owner must pay the purchaser the amount the purchaser bid for the property, the amount of the deed recording fee, and the amount paid by the purchaser as taxes, penalties, interest, and costs on the property, plus a redemption premium of 25% of the aggregate total if the property is redeemed during the first year of the redemption period, or 50% of the aggregate total if the property is redeemed during the second year within the redemption period. An owner of real property that is not homestead, or is not an agricultural property, may redeem the property after a tax foreclosure in the same manner, except that the redemption period is only 180 days after the recording date of the deed.

As stated, you may have a very limited amount of time to redeem your property and your rights are further diminished if the property is not for residential purposes, homestead, or an agricultural designated property. You must immediately consult with our Houston Real Estate redemption Attorneys and our Southwest Houston Real Estate Lawyers to learn more about your rights under the Texas Property Code and the Texas Tax Code. Please feel free to contact our attorneys online or via our office number at 713-517-6645.

DISCLAIMER

The information above is NOT intended to replace a personal consultation with our Houston Real Estate Transaction Lawyers and our Spring Houston Real Estate Litigation Attorneys. Readers should not construe the information as a consultation. There may be other legal issues based on the specific fact of each case. Every case is unique and our Houston Real Estate Transaction Attorneys and our North Houston Real Estate Litigation Lawyers need to review the facts and circumstances of each individual case in order to provide a meaningful personal consultation. Please feel free to give us a call at 713-517-6645 or complete our Contact Form.

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