In Texas, realty foreclosures can occur with or without using the court system, depending on the circumstances. The former is called a judicial foreclosure. The latter, unsurprisingly, is called a non-judicial foreclosure. In either event, there is a sale of the property as part of the foreclosure process at which qualified bidders, including the lender, can bid to purchase the property.
In a strict foreclosure, there is no sale. Instead, a court orders the debtor to pay the lender money owed, and title to the realty vests directly in the lender if the debtor fails to do so.
Texas law does not permit strict foreclosures of real estate.
In our Law 101 posts, we define terms, phrases, or concepts with the goal of conveying core information in order to set the stage for more complex discussions.