The 89th Texas Legislature has enacted several new laws impacting real estate transactions, property ownership, and recording practices. Many of these provisions take effect September 1, 2025, with one amendment effective January 1, 2026. Below is a summary of the most significant changes.
Recording of Property Documents (SB 647)
Effective September 1, 2025
Bill Text
- Establishes clearer standards for identifying fraudulent real estate documents.
- Authorizes county clerks to refuse to record suspected fraudulent transfers when probable cause is determined by the county or district attorney.
- Provides protections for clerks acting in good faith and adds procedural safeguards for legitimate filings.
Foreign Ownership of Real Property (SB 17)
Effective September 1, 2025
Overview | Bill Text
- Prohibits real property acquisitions in Texas by governmental entities, companies, and individuals tied to countries identified in federal national security threat assessments (including China, Russia, Iran, and North Korea).
- Exemptions apply to U.S. citizens, lawful permanent residents, dual citizens, and homestead property.
- Enforcement is handled through divestment proceedings initiated by the Attorney General, with lienholders protected through receivership.
Unilateral Memorandum of Contract (HB 4063)
Effective September 1, 2025
Bill Text
- Addresses abuse of unilateral memorandums of contract, which have been used to cloud title and pressure sellers.
- Requires property owner signatures on such filings.
- Provides a 45-day window for property owners to file a contradicting affidavit to remove improper memorandums.
Loan Administration Fees (HB 4738)
Effective January 1, 2026
Bill Text
- Eliminates the remittance of a portion of certain loan administration fees.
- Administrative change only; no material impact on lenders or borrowers.
Fraudulent Documents and Unauthorized Occupants (SB 1333 / HB 1076)
Effective September 1, 2025
Bill Analysis | Bill Text
- Provides faster remedies for property owners against squatters, allowing law enforcement intervention rather than requiring lengthy court proceedings.
- Clarifies procedures for removal of unauthorized occupants and strengthens penalties for fraudulent real estate filings.
Criminal Use of Notary Seal (SB 693)
Effective September 1, 2025
Bill Text
- Creates a state jail felony for misuse of a notary seal or counterfeit seal on fraudulent real estate documents.
- Specifically targets deed theft schemes involving forged signatures or false notarizations.
- Includes exceptions for properly conducted online notarizations.
Challenges to Fraudulent Real Property Documents (SB 1734)
Effective September 1, 2025
Bill Text
- Establishes a clear, cost-effective process for property owners to challenge fraudulently recorded documents.
- Allows an affidavit to be filed with the district clerk, followed by judicial review to determine document validity.
Fraudulent Financing Statements (SB 2221)
Effective September 1, 2025
Bill Text
- Provides a streamlined administrative process through the Secretary of State's office to remove fraudulent or baseless UCC-1 financing statements.
Proof of Identity in Acknowledgments (HB 4202)
Effective immediately
Bill Text
- Strengthens requirements for proving identity when acknowledging written instruments.
- Aimed at reducing fraud in real estate transactions involving notarized documents.
Key Takeaways
The new laws reflect the Legislature's focus on preventing fraud, protecting property owners, and increasing oversight of real estate transactions. These changes will affect county clerks, lenders, title companies, investors, and property owners statewide. Please e-mail compliancegroup@docsdirect.com with any questions.
