Question 1

Who services seller-financed notes and contracts for deed from a Texas subdivision?

Accepted Answer

A Texas note servicing company that handles both structures. Moat services seller-financed lot notes secured by a deed of trust under Tex. Property Code §51.002, and contracts for deed (executory contracts) under §5.061, which carry different default mechanics and a borrower cure right. Property-tax escrow through the county appraisal districts is part of the standard escrow workflow, including agricultural-exemption tracts.

Question 2

Does Moat service land contracts as well as deed-of-trust notes?

Accepted Answer

Yes. A land contract, also called a contract for deed or executory contract, keeps legal title with the seller until the contract is satisfied. Texas regulates these under Tex. Property Code §5.061 and following. Moat services properly executed contracts for deed case-by-case after a document review, alongside standard deed-of-trust notes.

Question 3

What is the difference between contract for deed and deed of trust in Texas?

Accepted Answer

A deed of trust is the standard Texas residential mortgage structure: the borrower takes title at closing, the lender records a first-lien deed of trust, and foreclosure proceeds non-judicially under Tex. Property Code §51.002 if the borrower defaults. A contract for deed (also called a land installment contract, executory contract, or contract sale) keeps legal title with the seller until the borrower satisfies the contract; the borrower has equitable title and possession. Texas regulates contracts for deed under Tex. Property Code §5.061 and following, with significant borrower protections including a cure right and disclosure obligations on the seller. The two structures have different default mechanics, different recordkeeping, and different consequences when a borrower stops paying.

Question 4

Do I need an RMLO to originate lot loans on my own subdivision?

Accepted Answer

It depends. If you are originating residential mortgage loans for compensation or gain on lots that include 1-to-4-family residential structures (or that will be built upon for residential use), the Tex. Finance Code Chapter 180 RMLO analysis applies. Raw land or commercial/business-purpose loans may sit outside the RMLO regime. The federal three-property exemption at 12 CFR §1026.36(a)(4) is federal-only and does not waive Texas licensing. See our Texas RMLO requirements page for the full decision tree.

Question 5

Can you service rural Texas and Hill Country notes?

Accepted Answer

Yes. We service notes across Texas: urban Dallas-Fort Worth and Houston, Austin, San Antonio metro, the Hill Country, East Texas, the Valley, and the West Texas / Permian Basin. Texas non-judicial foreclosure under §51.002 runs at the county courthouse where the property sits; we coordinate with Texas-experienced trustees in every county where our portfolios have property. Property tax administration through the county appraisal districts is part of our standard escrow workflow.

Question 6

How does pricing work for a bulk subdivision portfolio?

Accepted Answer

Bulk subdivisions and multi-lot seller-finance portfolios are common in our book. The published rate card applies per loan — $150 setup, $35/$40 monthly, a 50/50 late-fee split, a $50 optional expedite per loan (48-hour turnaround), and a $150 research/correction fee when intake rework is required — with no contract and a 30-day notice to terminate. For larger developer portfolios, we quote volume terms in writing per portfolio. Bring your portfolio list and loan structure to a consultation.

Question 7

What happens if a lot buyer defaults on a contract for deed?

Accepted Answer

Texas Property Code §5.061 and following protect the borrower more aggressively than the deed-of-trust regime. The seller must give written notice of default and provide a cure opportunity (often 30 to 60 days depending on the contract). Forfeiture and acceleration follow specific procedural rules; some scenarios let the borrower convert the contract to a deed of trust at any time. Default handling on contracts for deed is materially different from §51.002 foreclosure; we service contracts for deed case-by-case after a document review.

Question 8

Can I move my subdivision notes from one servicer to another mid-stream?

Accepted Answer

Yes. The RESPA 12 CFR §1024.33 transfer mechanics apply: 15-day notice to the borrower before the effective transfer date and a 60-day RESPA grace period for misdirected borrower payments. On the Moat side, form submission to active servicing typically takes 5–10 business days, with an optional $50 expedite per loan for a 48-hour turnaround. For bulk portfolios, allow extra time for document collection and reconciliation against the existing servicer’s ledger. See our switching servicers page for the full process.

Question 9

How does property tax escrow work for raw or rural land?

Accepted Answer

County appraisal districts in Texas assess raw and rural land annually; the tax bill arrives in October or November and is due by January 31. We administer property tax escrow on every escrowed loan: monthly accrual based on the prior-year tax bill (or initial estimate for new lots), disbursement to the county tax assessor by the due date, and annual escrow analysis under 12 CFR §1024.17. Agricultural-exemption and wildlife-exemption properties get the same treatment with the lower assessed values used as the escrow basis.

Servicing built for Texas subdivision and land-developer cash flow

Why subdivision notes need their own approach

Contract for deed vs deed of trust: the Texas choice

RMLO origination: when you need one

Texas regions we work in routinely

Bulk subdivision portfolios

Land-developer questions, answered

Boarding a Texas subdivision portfolio?