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Texas Property Code - Section 12.017. Title Insurance Company Affidavit As Release Of Lien; Civil Penalty

Legal Research Home > Texas Laws > Property Code > Texas Property Code - Section 12.017. Title Insurance Company Affidavit As Release Of Lien; Civil Penalty

§ 12.017. TITLE INSURANCE COMPANY AFFIDAVIT AS RELEASE OF 
LIEN;  CIVIL PENALTY.  (a) In this section:
		(1)  "Mortgage" means a deed of trust or other contract 
lien on an interest in real property.
		(2)  "Mortgagee" means:                                                       
			(A)  the grantee of a mortgage;                                              
			(B)  if a mortgage has been assigned of record, 
the last person to whom the mortgage has been assigned of record;  
or
			(C)  if a mortgage is serviced by a mortgage 
servicer, the mortgage servicer.
		(3)  "Mortgage servicer" means the last person to whom 
a mortgagor has been instructed by a mortgagee to send payments for 
the loan secured by a mortgage.  A person transmitting a payoff 
statement is considered the mortgage servicer for the mortgage 
described in the payoff statement.
		(4)  "Mortgagor" means the grantor of a mortgage.                             
		(5)  "Payoff statement" means a statement of the amount 
of:                 
			(A)  the unpaid balance of a loan secured by a 
mortgage, including principal, interest, and other charges 
properly assessed under the loan documentation of the mortgage;  
and
			(B)  interest on a per diem basis for the unpaid 
balance.                  
		(6)  "Title insurance company" means a corporation or 
other business entity authorized and licensed to transact the 
business of insuring titles to interests in real property in this 
state.
	(b)  This section applies only to a mortgage on property 
consisting exclusively of a one-to-four-family residence, 
including a residential unit in a condominium regime.
	(c)  If a mortgagee fails to execute and deliver a release of 
mortgage to the mortgagor or the mortgagor's designated agent 
within 60 days after the date of receipt of payment of the mortgage 
by the mortgagee in accordance with a payoff statement furnished by 
the mortgagee or its mortgage servicer, an authorized officer of a 
title insurance company may, on behalf of the mortgagor or a 
transferee of the mortgagor who acquired title to the property 
described in the mortgage, execute an affidavit that complies with 
the requirements of this section and record the affidavit in the 
real property records of each county in which the mortgage was 
recorded.
	(d)  An affidavit executed under this section must state 
that:               
		(1)  the affiant is an authorized officer of a title 
insurance company;     
		(2)  the affidavit is made on behalf of the mortgagor or 
a transferee of the mortgagor who acquired title to the property 
described in the mortgage;
		(3)  the mortgagee provided a payoff statement with 
respect to the loan secured by the mortgage;
		(4)  the affiant has ascertained that the mortgagee has 
received payment of the loan secured by the mortgage in accordance 
with the payoff statement, as evidenced by:
			(A)  a bank check, certified check, escrow account 
check from the title company or title insurance agent, or attorney 
trust account check that has been negotiated by the mortgagee;  or
			(B)  another documentary evidence of the receipt 
of payment by the mortgagee;
		(5)  more than 60 days have elapsed since the date 
payment was received by the mortgagee;
		(6)  the title insurance company or its agent has given 
the mortgagee at least 15 days' notice in writing of its intention 
to execute and record an affidavit in accordance with this section, 
with a copy of the proposed affidavit attached to the written 
notice;  and
		(7)  the mortgagee has not responded in writing to the 
notification, or a request for additional payment made by the 
mortgagee has been complied with at least 15 days before the date of 
the affidavit.
	(e)  The affidavit must include the names of the mortgagor 
and the mortgagee, the date of the mortgage, and the volume and page 
or clerk's file number of the real property records where the 
mortgage is recorded, together with similar information for a 
recorded assignment of the mortgage.
	(f)  The affiant must attach to the affidavit a photostatic 
copy, certified as a true copy of the original document, of:
		(1)  the documentary evidence that payment has been 
received by the mortgagee, including the mortgagee's endorsement of 
a negotiated check if paid by check;  and
		(2)  the payoff statement.                                                    
	(g)  An affidavit that is executed and recorded as provided 
by this section operates as a release of the mortgage described in 
the affidavit.
	(h)  The county clerk shall index the affidavit in the names 
of the original mortgagee and the last assignee of the mortgage 
appearing of record as the grantors and in the name of the mortgagor 
as grantee.
	(i)  A person who knowingly causes an affidavit with false 
information to be executed and recorded under this section is 
liable for the penalties for filing a false affidavit, including 
the penalties for commission of offenses under Section 37.02 of the 
Penal Code, and to a party injured by the affidavit for actual 
damages or $5,000, whichever is greater.  The attorney general may 
sue to collect the penalty.  If the attorney general or an injured 
party bringing suit substantially prevails in an action under this 
subsection, the court may award reasonable attorney's fees and 
court costs to the prevailing party.

Added by Acts 1993, 73rd Leg., ch. 1003, § 1, eff. Aug. 30, 1993.          

Last modified: August 11, 2007