A Texas lender holds a deed of trust with an acceleration clause. After the borrower misses three monthly payments, the lender sends a demand letter requiring immediate payment of the entire outstanding balance. The borrower argues the lender must give him a chance to cure before accelerating. Under Texas law, which statement is correct?
Correct Answer
D) The lender must provide a notice of intent to accelerate and give the borrower at least 20 days to cure before accelerating the debt
Under Texas Property Code §51.002(d) and established Texas case law, the lender must send a notice of intent to accelerate (also called a notice of default) before accelerating the debt. This notice must give the borrower at least 20 days to cure the default. Acceleration without proper prior notice is not effective.
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