Texas Private Lender Report 2027
The state of Texas private mortgage lending in 2027. Public data, plain English, written by the servicer.
EDITOR’S NOTE
This is the inaugural edition of the Moat Texas Private Lender Report. We publish only data we can cite to a public source. Where the Texas private-lender market has data sealed inside paid industry surveys (e.g. MBA) or inside individual servicer books (including ours), we summarize the methodology rather than republish unverified numbers. Annual edition; quarterly statutory re-verification.
Published May 28, 2026 by Moat Note Servicing, San Antonio, Texas (NMLS 1419346).
HEADLINE NUMBERS
What sizes the Texas private mortgage market in 2027
~30.5 million
Texas population (2024 est.)
Source: U.S. Census Bureau, 2024 Population Estimates
~12.0 million
Texas housing units (2024 est.)
Source: U.S. Census Bureau, ACS 5-year estimates
$29.5B across 87,212 notes
Texas seller-financed note volume (2025)
Source: NoteInvestor / Advanced Seller Data Services, 2025
First Tuesday of each month
Foreclosure sale day
Source: Tex. Property Code §51.002(a)
41 days (20-day cure + 21-day Notice of Sale)
Statutory minimum foreclosure timeline
Source: Tex. Property Code §51.002(d) and (b)
1.5% to 3.0% of market value
Effective property tax rate range
Source: Texas Comptroller of Public Accounts, county-level data
REGULATORY TIMELINE
The four dated rule changes shaping 2027
Texas private lenders operate inside a tighter regulatory frame than they did in the early 2020s. The four events below are the operative ones for the 2027 lending year.
January 1, 2022
SB 43 takes effect
Codified at Tex. Finance Code Chapter 159. Imposes RMLO licensing and specific written disclosures on residential wraparound mortgage originations in Texas.
November 23, 2024
Texas SML rule reorganization
Mortgage-servicer rules moved from 7 TAC Chapters 78-81 into the new Chapters 55-59. Structural reorganization that renumbered the entire compliance framework and tightened recordkeeping standards.
January 1, 2026
Surety bonds go electronic (filed through NMLS)
Texas-regulated mortgage servicers required to maintain their surety bond electronically through NMLS. Paper-bond filings phased out.
Ongoing 2024-2026
CFPB contract-for-deed advisory posture
CFPB advisory opinions through 2024 and into 2026 characterize some contract-for-deed arrangements as covered federal residential mortgage transactions. Texas executory-contract rules under Tex. Property Code §5.061 apply in parallel.
MARKET STRUCTURE
Four structural facts about the Texas private-lender market
High share of cash-light qualified buyers
Texas working-class household income, recent-immigrant population, and self-employment share combine to produce one of the deepest seller-finance buyer pools in the United States. Conventional underwriting rejects a meaningful share of these households despite reliable monthly income.
Fastest non-judicial foreclosure regime
Tex. Property Code §51.002 sets the statutory floor at 41 days from first formal notice to courthouse sale. In practice, 60 to 120 days from declared default to sale. The certainty of the timeline lets Texas private lenders price loans at retail rates and accept borrowers other lenders reject.
Active developer-direct origination
Texas subdivision developers routinely sell lots on owner-finance terms. Phase 1 of a typical residential subdivision can move 60 to 200 lots a year, much of it carrying developer paper. Phase 2 and Phase 3 development frequently recycle capital from Phase 1 note income.
Distinct statutory regime
Texas mortgage law diverges materially from the federal floor: Tex. Const. Art. XVI §50 homestead protections and the §50(a)(6) home-equity overlay, SB 43 / Chapter 159 wrap origination requirements, Chapter 180 RMLO licensing, executory contracts under Tex. Property Code §5.061, and the post-2024 SML Chapter 55-59 servicing regime. National-platform servicers cover Texas as one of 50 regimes; specialist Texas servicers cover Texas as the only regime.
What 2027 looks like
Three forces shape the Texas private-lender market in 2027.
- The electronic surety bond is now mandatory. The §58.107 electronic surety bond requirement took effect January 1, 2026, completing the post-2024 SML compliance cycle. Servicers who deferred the conversion run a tight timeline, and lenders using paper-bond servicers should confirm conversion before year-end.
- The wrap regime keeps maturing. The SB 43 / Chapter 159 wrap regime continues to draw more enforcement from the Texas SML and more case law from Texas appellate courts. Wrap originators relying on the federal three-property exemption should reconfirm Texas-side compliance with a regulatory attorney.
- Federal scrutiny of contracts for deed continues. The CFPB’s attention to contract-for-deed structures (advisory opinions through 2024-2026) layers federal scrutiny onto the Texas executory-contract framework under Tex. Property Code §5.061.
Operationally, the Texas private-lender book continues to outperform institutional servicing on raw cost-to-recover. The §51.002 41-day statutory floor, the first-Tuesday courthouse sale, and the non-judicial-by-default structure all give Texas private lenders a foreclosure timeline measured in months rather than years. The borrower pool remains deep; the developer-direct origination pipeline continues to feed new paper.
The biggest open variable for 2027 is the 90th Legislature, which convenes in January 2027. Mortgage-servicer rules, the SML’s 2024 reorganization, the SB 43 wrap regime, and the §50(a)(6) homestead-equity rules are all candidates for legislative attention if priority items emerge. We will update this Report after the session closes.
Methodology and sources
- Population and housing. U.S. Census Bureau 2024 Population Estimates (release April 2024); American Community Survey 5-year estimates (2018-2023 release December 2024). State-level Texas data sits at census.gov/quickfacts/TX.
- Property tax data. Texas Comptroller of Public Accounts annual property tax reports at comptroller.texas.gov/taxes/property-tax. County-level effective rates aggregated to the 1.5-3.0 percent statewide range.
- Statutes. All Texas statutory citations sourced to statutes.capitol.texas.gov. All federal citations sourced to the Cornell Legal Information Institute (law.cornell.edu/uscode) and the consumerfinance.gov regulations index. SML rule history at sml.texas.gov.
- NMLS licensee data. Public via nmlsconsumeraccess.org; aggregate Texas servicer license counts are searchable by license type.
- Not republished. MBA Mortgage Servicing Survey data and individual servicer book-level statistics (including Moat’s). Cited where they overlap public data; not republished beyond fair-use excerpting.
DEEPER READING
The operational pages this Report points to
ABOUT THE REPORT
About this Report
The Texas Private Lender Report 2027 is general information compiled from public sources. It is not legal, tax, investment, or financial advice. Statistics are accurate as of the most recent public release; the regulatory timeline reflects statutes and rules in effect at publication. For your specific transaction, consult a Texas attorney, tax professional, or financial advisor. Republication beyond fair-use excerpting requires written permission. Moat Note Servicing, LLC (NMLS 1419346) is a Texas-licensed mortgage servicer based at 1602 N PanAm Expy, San Antonio, TX 78208.
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