A Texas homeowner's property was recently reappraised and increased in value by $100,000. She already has a home equity loan at the maximum 80% LTV based on the old appraisal. Under Texas law, can she obtain additional home equity borrowing based on the higher appraised value?
Correct Answer
A) Yes, but she must first pay off the existing home equity loan, then take a new one based on the higher value
Under Texas law, only one home equity loan can be outstanding at a time (Section 50(a)(6)(K)). The homeowner must pay off the existing home equity loan first. She can then apply for a new home equity loan using a current appraisal reflecting the higher value, with the 80% LTV cap applied to the new valuation.
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- → A Texas property owner defaults on both a first mortgage and a second-lien home equity loan. The first mortgage lender forecloses and sells the property at the trustee's sale. Under Texas law, what happens to the second-lien home equity loan?
- → Under Texas foreclosure law, a property is sold at a trustee's sale on the first Tuesday of the month. The winning bidder pays the full purchase price. Under Texas Property Code, when does the bidder receive a trustee's deed?
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- → A Texas lender fails to cure a constitutional defect in a home equity loan within the required timeframe. The borrower files a lawsuit. Under Texas Constitution Article XVI, Section 50(a)(6)(Q)(x), what is the potential penalty for the lender's failure to cure?
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A Texas lender offers a home equity loan with a variable interest rate that can adjust monthly with no cap on rate increases. Under Texas Constitution Article XVI, Section 50(a)(6), is this loan structure permissible?
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A Texas borrower closes on a home equity loan on June 1. She exercises her right of rescission on June 10. Under Texas Constitution Article XVI, Section 50(a)(6)(Q)(x), what happens to the loan after rescission?