As we previously reported in April, Texas’s initial approach to foreclosures in light of the coronavirus was “ad hoc” and the decision whether to halt foreclosures was left to the various counties in which the sales were conducted. Since that time, the state has begun reopening but has seen a rise in the number of daily coronavirus cases that worries state and local officials, especially in Texas’s largest metropolitan areas.
In response to this rise, Gov. Greg Abbott issued Executive Order 29 and a Proclamation Amending Executive Order 28 reinstating health and safety limitations in the state of Texas. By way of these orders, public gatherings of more than 10 persons are now, with some exceptions, prohibited throughout the state. This prohibition would seemingly affect foreclosure sales, which typically draw large crowds that can number in the hundreds. Absent consent of the local county judge or mayor, however, these sales would arguably violate Gov. Abbot’s July 2, 2020 Executive Order and Proclamation. Because neither of Gov. Abbott’s orders specifically addresses foreclosure, the decision to continue with or suspend foreclosure Tuesday apparently devolves to local government.
Local governments in Harris and Travis counties expressly canceled July foreclosure sales. Other large counties such as Dallas and Fort Bend counties simply have no foreclosure listings for the month of July. Tarrant, Bexar, Collin, Hidalgo, El Paso and Denton counties have not issued any guidance on the matter but still have July foreclosure listings posted.
The decision to deal with foreclosures in light of COVID-19 in Texas remains with local government, although that may not have been the original intent of Gov. Abbott’s most recent executive order. Among the top 10 most populated counties, there appears to be a 50-50 split between those proceeding with foreclosure Tuesday and those that have suspended July foreclosures. This split among counties injects further uncertainty into creditors’ ability to protect their rights. Because Texas has not issued any statewide orders governing foreclosure proceedings, creditors should continue to proceed with caution.
