Texas Has Some of the Country's Strictest Home Equity Laws. Here's What to Know Before You Borrow

Texas home equity lending is uniquely regulated by strict constitutional protections. Home equity loans and HELOCs combined cannot exceed 80% of a property's market value, ensuring at least 20% equity remains. Borrowers face a 12-day waiting period before closing, are limited to one home equity loan per year, and fees are capped at 2%. Loans are non-recourse, limiting lender recovery to the home itself. These rules promote cautious borrowing and protect homeowners.