Stringer v. Cendant Mortgage Corp.

This case is before the Court on a certified question from the United States Court of Appeals for the Fifth Circuit. The question is: under the Texas Constitution, may a home-equity lender require the borrower to pay off third-party debt that is not secured by the homestead with the proceeds of the loan? 199 F.3d 190, 192 (5th Cir.1999). We answer the certified question yes.

I. BACKGROUND

The Texas Constitution protects the homestead from forced sale for payment of all debts other than those specifically excepted by the Constitution. See Tex. Const, art. XVI, § 50. In 1997, the citizens of…