Houston Consumer Protection – Lien Enforcement Laws – Perfection
Establishing priority is an important step in the lien enforcement process and a critical underpinning of real estate law, consumer law and business law. Prior to initiating foreclosure proceedings, a lender or other entity must perfect its lien and establish the order in which it receives compensation during an eventual foreclosure. This is known as “priority.”
Lenders that do not follow applicable regulations when establishing priority may be legally unable to secure compensation during foreclosure. Further, serious disputes may precipitate commercial litigation and other adverse legal actions. It is critical for borrowers and homeowners to understand their rights and responsibilities during the perfection, priority establishment and foreclosure process.
Lien Enforcement, Perfection and Consumer Protection Law in Texas
Under normal circumstances, a lien’s priority depends on the order in which it was filed. Earlier liens generally take precedence over later liens. As such, first mortgages typically take higher priority over subsequent liens, such as judgment and creditor liens.
However, there are some important exceptions to this general rule. Liens that take priority over earlier liens include:
- Mechanic and materialman liens
- HOA and COA liens
- Property tax liens
- Liens related to special assessments
It is important to note that the laws governing lien priority may vary over time. Moreover, creditors holding lower-priority liens may not receive full compensation during an eventual foreclosure – an important consideration for homeowners facing multiple liens of varying priority.
Working with a Seasoned Houston Corporate Attorney
The lender-borrower relationship does not always unfold as planned. Lenders that improperly claim priority on liens placed on real property or engage in other malfeasance with regard to relevant real estate laws and regulations may jeopardize the business planning activities of their customers. As such, it is critical for borrowers to understand the concept of priority and other aspects of lien enforcement, mortgage credit and secured credit in Sugar Land, The Woodlands, Katy and the rest of the greater Houston area.
At the Law Offices of Lambert & Jakob, we are committed to upholding the rights of homeowners, landlords and small business owners facing foreclosure and other adverse actions. Moreover, we are uniquely equipped to evaluate lien priority and advise clients how best to proceed in potential disputes. Our principal attorneys have more than four decades of experience in this critical area of business law and real estate law as well as major experience in matters related to accounting and auditing.
Whether you are a Galveston landlord worried about a creditor’s claim of priority or a Pearland homeowner facing the possibility of foreclosure in the near future, we invite you to schedule a free, no-obligation consultation to evaluate the facts of your case.
Contact Us For A Consultation
If you would like to learn more how our Houston consumer protection lawyers can assist with lien enforcement and priority matters related to mortgage credit, secured credit and other aspects of real estate law and credit in Harris, Waller and Fort Bend County, please call us at (713) 640-5700 or fill out the online contact form to schedule a free, no-obligation consultation.