[TX] What documents are required for secure owner financing, and is a vendor’s lien alone sufficient?

TX Real Estate

Hello, I found the Texas warranty deed but need one with a vendor’s lien to reflect owner financing. Can you help?

January 9, 2026

Jon

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In Texas, owner financing is typically secured using a Promissory Note and a Deed of Trust, not just a lien. Texas follows “title theory,” meaning a trustee holds legal title until the loan is paid off. This setup allows for faster, non-judicial foreclosure if the buyer defaults (Tex. Prop. Code § 51.002).

You should not simply transfer the deed without protection. The Deed of Trust secures your interest while the buyer makes payments. Once paid in full, the lien is released. You will generally need:

A Warranty Deed with Vendor’s Lien
A Promissory Note
A Deed of Trust

Using only a vendor’s lien can force you into costly court foreclosure. Adding a Deed of Trust gives you stronger protection with minimal extra cost. While templates exist, having documents drafted correctly is critical to protect your property and your ability to collect. Did that help clarify things?

Texas General Warranty Deed – Official

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Hello, I found the Texas warranty deed but need one with a vendor’s lien to reflect owner financing. Can you help?

Lexi, Chatbot

I understand you’re looking to modify a Texas warranty deed to reflect owner financing. Can you tell me the current lien status on the property?

I own the property with no liens.

Lexi, Chatbot

Have you already entered into an owner-financing agreement with the buyer?

We have a verbal agreement, but that’s all.

Lexi, Chatbot

Is there anything else the real estate lawyer should know?

I don't think so.

Jon

Hello! I’m Jon, a licensed attorney with over 13 years of experience. I’ll do my best to guide you. Are you selling the property and offering financing to the buyer?

Yes.

Jon

Have you agreed on terms like interest rate, payment schedule, and loan length?

We have a general idea but need to finalize the payment schedule.

Jon

Do you plan to use a title company or attorney for closing, or handle it yourself?

I’d like to handle it myself.

Jon

Understood. Anything else you’d like to add before I prepare your answer?

No, thank you.

Jon

You should not simply transfer the deed without protection. The Deed of Trust secures your interest while the buyer makes payments. Once paid in full, the lien is released. You will generally need:

A Warranty Deed with Vendor’s Lien
A Promissory Note
A Deed of Trust

Jon

556 satisfied customers

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