Home Equity
Home Equity Loans in Texas
Published September 24, 2026 · Last updated September 30, 2026
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The short answer
A Texas home equity loan follows special rules written into the state constitution. You can't borrow more than 80% of your home's value, counting every loan on it. Most fees are capped at 2%. You must wait at least 12 days before closing. And in most cases, the lender can take only the home if you don't pay, not your other assets.
These rules are some of the strongest home equity protections in the country. Your home still backs the loan, so you could lose it if you don't repay.
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Texas home equity loan rules
These rules come from Article XVI, Section 50 of the Texas Constitution. You'll sometimes hear these loans called "50(a)(6) loans" after the section that sets them up.
80% limit. All loans on your home together can't be more than 80% of its fair market value. That includes your first mortgage.
2% fee cap. Most fees to make the loan can't total more than 2% of the loan amount. Third-party appraisals, surveys, and title insurance don't count toward the cap.
12-day wait. The loan can't close until at least 12 days after you apply and get the required Texas notice. This gives you time to think it over.
Where it closes. Only at the lender's office, an attorney's office, or a title company. Not at your kitchen table.
Everyone has to agree. Each owner of the home, and each owner's spouse, must consent to the loan.
No personal liability. If you default, the lender can go after the home, but not your other assets or wages for the debt, unless you got the loan through actual fraud.
Court order to foreclose. A lender can only foreclose on a Texas home equity loan with a court order. The home can still be lost this way.
Right to cancel. You can cancel within 3 days after closing.
One loan every 12 months. Texas generally allows only one home equity loan on your home in any 12-month period.
How much can you borrow in Texas?
Start with your home's value, take 80% of it, and subtract what you already owe. For example, if your home is worth $300,000, 80% is $240,000. If you owe $180,000 on your mortgage, the most you could have in a home equity loan is about $60,000, before fees.
If you already owe a lot on your mortgage, you may not be able to borrow much. The lender's appraisal sets the value used in the math.
Texas home equity lines of credit (HELOCs)
A Texas HELOC follows the same 80% limit and most of the same protections. It also has extra limits on how much you can draw at once and how often. Ask the lender to walk you through them before you plan around a number. See how a HELOC works in general.
Can you refinance a Texas home equity loan?
Yes. You can refinance it into another Texas home equity loan. Since a 2017 change to the Texas Constitution, you may also be able to refinance it into a regular mortgage if at least a year has passed, you don't take any new cash, and the new loan fits within the 80% limit, among other conditions.
If you refinance into a regular mortgage, you lose some of the Texas home equity protections, like the no-personal-liability rule. Ask the lender to explain the trade-off in writing.
What a Texas home equity loan costs
Price range
We don't list rates or payments on this page. Your rate and terms come only from a lender, based on your situation. Compare offers from more than one lender.
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The 2% fee cap limits most lender fees, but it's not the only cost. Appraisals, surveys, and title insurance are extra. Compare the APR, which rolls interest and many fees into one yearly number.
What to ask before you choose
- "How much can I borrow under the 80% limit?"
- "Which fees count toward the 2% cap, and which don't?"
- "When will I get the Texas notice, so my 12 days can start?"
- "What's the APR, and are there prepayment penalties?"
- "If I want to refinance later, what are my options?"
The catch: the 80% limit counts your first mortgage too. And since you can only take one Texas home equity loan every 12 months, borrow what you'll actually need.
Keep reading
Compare a HELOC, a Texas cash-out refinance, or a home equity investment. Borrowing for storm repairs? Get roofing quotes and check your Texas homeowners insurance.
More Texas guides: Texas homeowners insurance · Texas car insurance · Texas roofing laws · Texas cash-out refinance · Houston homeowners insurance · Houston car insurance · Houston roof replacement · Dallas homeowners insurance · Dallas car insurance
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HELOC
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Cash-Out Refinance
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