Schmidt v. Assured Lender Services et al

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
GALVESTON DIVISION
LAURA SCHMIDT,
Plaintiff.
V.
ASSURED LENDER SERVICES,
et al.,
Defendants.
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CIVIL ACTION NO. 3:25-cv-00337
MEMORANDUM AND RECOMMENDATION
Plaintiff Laura Schmidt has filed a Motion to Declare Lien Void and
Unenforceable. Dkt. 15. Schmidt asks this court to “enter an order declaring the
commercial loan lien on [Schmidt]’s residential homestead to be invalid and
unenforceable as a matter of law.” Id. at 1. Because Schmidt claims she is entitled
to judgment as a matter of law, I construe Schmidt’s motion as a motion for
summary judgment. Having considered the motion, the response, the reply, and
the applicable law, I recommend that the motion be denied.
BACKGROUND
On July 28, 2021, Schmidt obtained a loan from Velocity Commercial
Capital in the amount of $168,750.00 (the “Loan”). The Loan is secured by a Deed
of Trust granting a lien against the real property and improvements located at 102
Ridge Road, Manvel, Texas 77578-4204. U.S. Bank is the current owner and holder
of the Loan and Deed of Trust. PHH Mortgage Corporation is the Loan servicer.
On October 2, 2025, Schmidt filed suit in state court seeking, among other
things, to enjoin a foreclosure sale on 102 Ridge Road. After the case was removed
to this court, Schmidt amended her complaint to assert causes of action for quiet
title and declaratory judgment. Smith seeks a declaratory judgment that the lien
on 102 Ridge Road is invalid because the property is her homestead.
United States District Court
Southern District of Texas
ENTERED
April 09, 2026
Nathan Ochsner, Clerk
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In her pleadings, Schmidt claims that 102 Ridge Road has been her
homestead since March 17, 2021. The documents Schmidt signed on July 28,
2021—the same date she executed the Loan and Deed of Trust—tell a much
different story. Schmidt signed a Certification of Non-Owner Occupancy and
Indemnity stating, under penalty of perjury, that: (i) her “true and only principal
residence” is 514 West Lang Street, Alvin, Texas 77511; (ii) 102 Ridge Road is not
her principal residence; and (iii) she has no intention of ever making 102 Ridge
Road her principal residence. Dkt. 18-3 at 2. Schmidt also signed an Affidavit of
Non-Homestead in which she stated under oath that: (i) her homestead property
is 514 West Lang Street, Alvin, Texas 77511; (ii) she does “not now and do[es] not
intend ever to reside on, use in any manner, or claim” 102 Ridge Road as a
homestead; and (iii) she “disclaim[s] all homestead right, interest, and exemption
related to” 102 Ridge Road. Dkt. 18-4 at 2.
THE LEGAL FRAMEWORK
A. 	S UMMARY JUDGMENT
Summary judgment is appropriate when “the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as
a matter of law.” Fed. R. Civ. P. 56(a). “A genuine issue of material fact exists when
there is evidence sufficient for a rational trier of fact to find for the non-moving
party.” Schnell v. State Farm Lloyds, 98 F.4th 150, 156 (5th Cir. 2024) (quotation
omitted).
B. 	HOMESTEAD PROPERTIES AND THE TEXAS CONSTITUTION
“Homestead properties are afforded special and unique protections under
the Texas Constitution.” Thomas v. Graham Mortg. Corp., 408 S.W.3d 581, 588
(Tex. App.—Austin 2013, pet. denied) (citing Tex. Const. art. XVI, § 50). “Texas
homesteads are generally exempt from ‘forced sale, for the payments of all debts,’
except for those debts specifically enumerated in the constitution.” Thomas, 408
S.W.3d at 588 (quoting Tex. Const. art. XVI, § 50). “When a lien that is not
constitutionally permitted is placed on homestead property, the lien on the
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property is void.” Thomas, 408 S.W.3d at 588; see also Hankins v. Harris, 500
S.W.3d 140, 144 (Tex. App.—Houston [1st Dist.] 2016, pet. denied) (“Generally, a
lien may not attach to property that is held as the debtor’s homestead[] because
the Texas Constitution provides that homestead property is exempt from forced
sale to pay debts, except for certain specified categories of debts.”). Under Texas
law, a commercial loan, like the one at issue here, cannot be secured by a
homestead lien. See Tex. Const. art. XVI, § 50.
That said, “a previously acquired lien, whether general or special, voluntary
or involuntary, . . . cannot be subsequently defeated by the voluntary act of the
debtor in attempting to make [the property] his homestead.” Gage v. Neblett, 57
Tex. 374, 378 (1882). Stated differently, “when the property has not become a
homestead at the execution of the mortgage, deed of trust or other lien, the
homestead protections have no application even if the property later becomes a
homestead.” Inwood N. Homeowners’ Ass’n v. Harris, 736 S.W.2d 632, 635 (Tex.
1987).
ANALYSIS
Given the legal framework discussed above, the lien on 102 Ridge Road is
void if the property was designated as Schmidt’s homestead on July 28, 2021, the
date the loan originated. Conversely, the lien is valid if 102 Ridge Road was not
Schmidt’s homestead on July 28, 2021.
At this stage of the proceedings, there is a genuine issue of material fact as
to when 102 Ridge Road became Schmidt’s homestead. On one hand, Schmidt now
contends that 102 Ridge Road has been her homestead since March 17, 2021, which
is several months before she obtained the loan that created the lien at issue. 1 On
the other hand, there is a trove of documentation indicating that 102 Ridge Road
1 The record is devoid of any competent summary judgment evidence establishing that
102 Ridge Road has been Schmidt’s homestead since March 17, 2021. Schmidt makes such
an assertion in her pleadings, but it is well-established that unsworn pleadings are not
competent summary judgment evidence. See Davis v. Fernandez, 798 F.3d 290, 292 (5th
Cir. 2015); Gordon v. Watson, 622 F.2d 120, 123 (5th Cir. 1980).
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did not become Schmidt’s homestead until after July 28, 2021—the date the loan
originated. This evidence includes various documents that Schmidt signed under
oath on July 28, 2021, stating that 102 Ridge Road was not her homestead, and she
had no intention of ever making it her homestead.
It is improper for me to resolve factual disputes at summary judgment. That
task is left to the trier of fact at trial. See Int’l Shortstop, Inc. v. Rally’s, Inc., 939
F.2d 1257, 1263 (5th Cir. 1991) (On summary judgment, district courts may not
“evaluate the credibility of the witnesses, weigh the evidence, or resolve factual
disputes.”). The sole question at summary judgment is whether a “reasonable jury
drawing all inferences in favor of the nonmoving party could arrive at a verdict in
that party’s favor.” Id. Because a reasonable jury could, based on the record before
me, find that 102 Ridge Road was not Schmidt’s homestead on the date the loan
originated, summary judgment must be denied. 2
CONCLUSION
For the reasons explained above, I recommend that Schmidt’s Motion to
Declare Lien Void and Unenforceable (Dkt. 15) be denied.
The 	parties 	have 	14 	days 	from 	service 	of 	this 	Memorandum 	and
Recommendation to file written objections. See 28 U.S.C. § 636(b)(1)(C); Fed. R.
Civ. P. 72(b)(2). Failure to file timely objections will preclude appellate review of
factual findings and legal conclusions, except for plain error.
SIGNED this 	day of April 2026.
______________________________
ANDREW M. EDISON
UNITED STATES MAGISTRATE JUDGE
2 To be clear, I am not deciding at this time when 102 Ridge Road became Schmidt’s
homestead. That is a question that will be answered later in this case.
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