Texas House Bill HB 576

Texas 2025 - 89th Regular

• Filed: 11/12/24
• Out of House Committee: 4/29/25

Caption

Relating to the persons authorized or appointed to exercise the power of sale under the terms of a contract lien on real property.

Summary

HB 576 amends the Texas Property Code provisions governing foreclosure-related authority under a security instrument. The bill broadens the statutory definitions of “substitute trustee” and “trustee” so that, instead of referring only to a “person” or “persons,” those roles may also be filled by a wider range of legal entities, including corporations, organizations, government entities, trusts, partnerships, associations, and other legal entities. The measure applies to the individuals or entities appointed or authorized by the mortgagee or mortgage servicer to exercise the power of sale under a contract lien on real property. In practical terms, the bill updates foreclosure and deed-of-trust terminology to reflect that entities other than natural persons may serve in these roles. It does not create a new foreclosure process or change the underlying power of sale; rather, it clarifies who may legally act as trustee or substitute trustee under Texas law. The bill would amend Section 51.0001 of the Property Code and would take effect immediately if approved by a two-thirds vote in each chamber, or otherwise on September 1, 2025.

Impact

HB 576 would modify the Texas Property Code definitions used in nonjudicial foreclosure and contract-lien enforcement, expanding the list of eligible trustees and substitute trustees beyond individuals to include a broad set of legal entities. This change could affect mortgage servicers, lenders, foreclosure trustees, title companies, and other parties involved in exercising the power of sale on real property. The bill is a technical statutory update that may reduce ambiguity about whether entities can serve in these roles under existing foreclosure documents and procedures.

Sentiment

The available record shows little to no public controversy or debate around HB 576. There are no committee transcript excerpts or recorded votes provided, and the bill’s language is narrowly technical rather than policy-driven. The overall sentiment appears neutral and administrative, suggesting the measure was likely intended to clarify existing law rather than alter substantive rights or foreclosure policy.

Contention

No specific points of contention are documented in the provided materials. If any concerns existed, they would most likely center on whether expanding trustee eligibility to entities could affect foreclosure administration, accountability, or the interpretation of existing security instruments. However, the bill text itself is limited to definitional changes, and the record provided does not identify any opposition, amendments, or disputed issues.