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Indemnity Agreement from a surety agency Business Debt, Collections

Discussion in 'Other Debt, Collection, Garnishment' started by shall822001, Dec 9, 2017.

  1. shall822001

    shall822001 Law Topic Starter New Member

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    Regarding an indemnity agreement with a surety agency. Does the indemnity agreement allows the surety agency to legally go after the borrower personal assets, like the borrower home? If so, what is usually done if the borrower do have not equity in their home? What is usually done if the borrower do not have any asset? I am trying to get a understanding of the strategy that the surety agency might go to recover those funds. Any suggestions would be greatly appreciated. Thank you!
  2. despritfreya

    despritfreya Active Member

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    Unless you gave the bonding company a mortgage against your home or a security interest in personal property, it should have to sue you and get a judgment before it can execute on your property. This should be no different from any other unsecured creditor.

  3. army judge

    army judge Super Moderator

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    Texas' constitution and the Homestead Exemtion Act prohibits foreclosing against your main homestead to satisfy loans or debts.

    The most such creditors can do is place a lien against the property.

    Our constitution also exempts levying against most of your personal assets to satisfy debts.

    Here you go, take a look at this:

    Texas Homestead Law Overview - FindLaw
  4. zddoodah

    zddoodah Well-Known Member

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    Exactly how are we supposed to know the terms of the agreement you signed?

    That said, if it's like just about every other indemnity agreement in the surety industry, it makes you liable for all losses and expenses incurred by the surety as a result of having issued the bond. It may contain an assignment of assets, but again, we haven't read your agreement. If it does not contain an assignment provision, then all the surety can do is sue you and get a judgment against you and try to enforce that judgment against you as provided under Texas law. Fortunately for you, Texas law makes one's personal residence exempt from the enforcement of ordinary civil judgments. That's one reason why Texas is regarded as a haven for deadbeats.

    There is no industry standard for this sort of thing. Each company makes its own decisions on a case by case basis.

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