Write to the servicer, prove you are a successor in interest, then ask for loss mitigation or a payoff. Federal law bars calling the loan due just because a relative inherited the home, and a confirmed successor is treated as a borrower. Texas requires 20 days to cure and 21 days' notice before a sale.
A parent dies, the mortgage payments stop, and a few months later the family finds a foreclosure letter in the mailbox. This happens often, and Texas foreclosures move quickly. The good news is that federal servicing rules give heirs real rights, and the Texas notice rules give you a known amount of time to use them.
This guide explains those rules statewide. For courthouse sale locations and county clerk notice lookups in Tarrant, Dallas, Collin and Denton counties, see our DFW guide to stopping foreclosure on an inherited house. It is general information, not legal advice. A Texas probate or consumer attorney, or a HUD-approved housing counselor, can review your notices.
The loan does not die with the borrower
Under Estates Code Sec. 101.001, a house passes to the heirs or devisees at death. Sec. 101.051 says it passes subject to the decedent's debts. A deed of trust stays on the house, and if the payments stop, the lender can still foreclose. The heirs may not owe the debt personally, but the house secures it.
So the choice for heirs is not whether the loan matters. It is whether to keep paying it, change its terms, or pay it off by selling.
Inheriting does not trigger the due-on-sale clause
Most mortgages say the whole balance comes due if the house is transferred. The Garn-St Germain Act limits that. Under 12 U.S.C. 1701j-3(d), for a loan on a home with fewer than five dwelling units, a lender may not use a due-on-sale clause because of:
- a transfer by devise, descent or operation of law on the death of a joint tenant or tenant by the entirety;
- a transfer to a relative resulting from the death of a borrower;
- a transfer where the borrower's spouse or children become owners.
The loan keeps its rate and schedule. What the heir does not get is a pause: missed payments are still a default.
Step one: become a confirmed successor in interest
Regulation X, the CFPB's mortgage servicing rule, uses the term "successor in interest." Under 12 CFR 1024.31, that includes a person who received an ownership interest by devise or descent, a relative who received it because of a borrower's death, and a spouse or child who became an owner. A "confirmed successor in interest" is one whose identity and ownership the servicer has confirmed.
Getting confirmed starts with a letter. Under 1024.36(i), if you send a written request that says you may be a successor, names the borrower you received the interest from, and identifies the loan, the servicer must answer in writing with the documents it reasonably requires and a phone number for help. Send it to the address the servicer designates for information requests, if it has one; otherwise it may not count.
Response deadline: Section 1024.36(d)(2) gives servicers 30 days, not counting weekends and legal holidays, to answer most information requests, with one 15-day extension if they notify you. Keep proof of when you mailed the letter.
The servicer's document list has limits. The official commentary to 1024.38 says requirements must be reasonable in light of state law. It gives an example: if state law requires only an affidavit of heirship to show an heir's interest, it generally would not be reasonable for the servicer to insist on probate. The same commentary says a servicer does not have to go looking for successors it has not been told about. You have to make contact.
What confirmation gets you
Under 1024.30(d), a confirmed successor in interest is treated as a borrower for the servicing rules. The CFPB's interpretation adds two points heirs should know:
- The servicer may not require you to assume the loan before treating you as a borrower.
- Confirmation does not by itself make you personally liable. Liability is decided by state law.
That means you can send written information requests about the account and be reviewed for loss mitigation, such as a loan modification or repayment plan. The loss mitigation and early intervention rules in 1024.39 through 1024.41 apply only when the house is the borrower's principal residence, and the CFPB says that depends on the facts and that a vacant house may still qualify. Small servicers are exempt from 1024.38 through 1024.41 except for 1024.41(j), which still holds them to the 120-day rule below.
Federal timing rules that can hold off a sale
- The 120-day rule. Section 1024.41(f)(1) bars the servicer from making the first notice or filing for foreclosure until the loan is more than 120 days delinquent, with narrow exceptions. In a Texas non-judicial foreclosure, the first notice is the earliest document required to be recorded or published.
- The 37-day rule. Under 1024.41(g), if a complete loss mitigation application arrives after the first notice but more than 37 days before a scheduled sale, the servicer may not conduct the sale unless it has denied the application and any appeal, you turned down every option offered, or you stopped performing under an agreed option.
- Applications before confirmation. If you apply before you are confirmed, the servicer may review right away or hold the file. If it holds it, the CFPB commentary says it must treat the application as received on the date it confirms you. Get confirmed early so that date is not too close to a sale.
The Texas foreclosure steps and deadlines
When a deed of trust contains a power of sale, Texas lets the lender sell the house at auction without a lawsuit. Property Code Sec. 51.002 sets the minimum steps:
| Step | What the statute requires |
|---|---|
| Notice of default | Certified mail to the debtor in default, giving at least 20 days to cure before notice of sale (51.002(d)) |
| Notice of sale | At least 21 days before the sale: posted at the courthouse door, filed with the county clerk, and sent by certified mail to each debtor obligated on the debt according to the servicer's records (51.002(b)) |
| Sale day | Public auction on the first Tuesday of a month (the first Wednesday if that Tuesday is January 1 or July 4) between 10 a.m. and 4 p.m., at the area the county designates (51.002(a) and (a-1)) |
Watch one detail. For a loan on a residence, Sec. 51.0001(2) makes the debtor's last known address the house itself unless the borrower sent the servicer a written change of address. Service is complete once the letter is mailed (51.002(e)). So the notices may be addressed to a parent who has died, at a house no one checks. Forward the mail, and look up the county's posted sale notices yourself; Sec. 51.002(f-1) requires each county to post them on its website.
Ways heirs stop or avoid the sale
- Catch up the payments. The notice of default gives at least 20 days to cure. If that window has passed, ask the servicer in writing for a reinstatement figure and a deadline.
- Apply for loss mitigation. Get confirmed, then send a complete application well ahead of any sale date so the 37-day rule protects you.
- Sell and pay off the loan. A sale that closes before the auction pays the lender from the proceeds and ends the foreclosure. Someone must have authority to sign the deed, such as an executor or all the heirs together.
- Get legal help fast if a sale is scheduled. A lawyer can look for notice defects or other defenses.
A quick action list
- Find every letter from the servicer and note any sale date.
- Send a written successor-in-interest request with the death certificate and the loan number.
- Ask for a payoff statement and a reinstatement figure.
- Decide whether the family will keep the house or sell it.
- If keeping it, submit a complete loss mitigation application as soon as you are confirmed.
- If selling, line up the person with authority to sign and set a closing date before the auction.
Selling before the auction date
When the family would rather sell than take on the payments, speed matters. Cash Home Advisors can close in 7–14 days and pays all closing costs. The loan payoff appears on the closing statement, and you see every line of it before you sign.
Request a cash offer, read our page on selling before a Texas foreclosure, or see how our process works. If the title is still in a parent's name, our guide to time limits on inherited property explains the probate options.
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Frequently asked questions
Can the lender call the loan due because I inherited the house?
Not on that ground alone for most homes. The Garn-St Germain Act, 12 U.S.C. 1701j-3(d), bars a lender from using a due-on-sale clause on a home with fewer than five units when the transfer is to a relative resulting from the borrower's death, or when the borrower's spouse or children become owners. The payments still have to be made.
Do I have to assume the mortgage before the servicer will work with me?
No. The CFPB's official interpretation of Regulation X says a servicer may not require a confirmed successor in interest to assume the loan to be treated as a borrower. Whether you become personally liable is decided by state law, not by confirmation.
How much notice does Texas require before a foreclosure sale?
For a residence, Property Code Sec. 51.002(d) requires a written notice of default by certified mail giving at least 20 days to cure. Then Sec. 51.002(b) requires notice of sale at least 21 days before the sale, which is held on the first Tuesday of a month between 10 a.m. and 4 p.m.
What documents will the servicer ask an heir for?
Under 12 CFR 1024.36(i), the servicer must answer a qualifying written request with a list of the documents it reasonably requires to confirm your identity and ownership. The CFPB commentary to 1024.38 says those requests should be reasonable under state law; where only an affidavit of heirship is required, demanding probate generally would not be reasonable.
Sources
- CFPB, Regulation X 12 CFR 1024.31 (definitions of successor in interest)
- CFPB, Regulation X 12 CFR 1024.30 (scope; confirmed successors treated as borrowers)
- CFPB, Regulation X 12 CFR 1024.36 (requests for information; potential successors)
- CFPB, Regulation X 12 CFR 1024.38 (servicer policies on successors in interest)
- CFPB, Regulation X 12 CFR 1024.41 (loss mitigation; 120-day and 37-day rules)
- 12 U.S.C. 1701j-3 (Garn-St Germain due-on-sale exemptions), Cornell LII
- Texas Property Code, Chapter 51 (Sec. 51.0001 definitions; Sec. 51.002 sale under contract lien)
- Texas Estates Code, Chapter 101 (Secs. 101.001 and 101.051)
General information, not legal or tax advice. Talk to a Texas attorney or CPA about your situation.