Texas Property Code Chapter 5: Conveyances Explained (2026)

Texas Property Code Chapter 5, titled "Conveyances," is the statute that governs how real property legally changes hands in Texas — what makes a deed valid, what a seller must disclose before closing, and how contract-for-deed (executory contract) sales must be structured to protect buyers. Subchapter A covers general conveyance rules, including Section 5.008's Seller's Disclosure Notice requirement, and Subchapter D regulates executory contracts for conveyance. For exam purposes, Chapter 5 is one of the most heavily tested pieces of the Property Code because it sits at the intersection of two things the TREC exam loves: deed mechanics and consumer-protection disclosure rules. Agents who skim past it tend to miss questions on executory contracts, which the exam treats as a distinct, high-risk transaction type.

Under Property Code Section 5.001, a conveyance of real property in Texas is presumed to transfer a fee simple estate unless the deed contains express words limiting the estate — meaning a seller cannot accidentally convey less than full ownership just by leaving out boilerplate language. This default-to-fee-simple rule has applied to conveyances since February 5, 1840, making it one of the oldest continuously operating provisions in Texas property law. Texas agents work with three deed types in practice, though only some carry statutory warranty language: - **General warranty deed** — the grantor warrants title against defects arising both during and before their ownership, going all the way back through the chain of title. This is the standard deed used in most Texas residential resales. - **Special warranty deed** — the grantor warrants title only against defects arising during their own period of ownership, not before. Builders and lenders selling REO property commonly use this form because it limits their liability exposure. - **Quitclaim deed** — conveys whatever interest the grantor has, if any, with zero warranty of title. Title companies in Texas are typically reluctant to insure a chain of title that includes a quitclaim deed without additional curative work, which is why quitclaims are rare in arm's-length sales and mostly used to clear up boundary disputes or transfers between family members. For a deed to be valid and recordable in the first place, it must satisfy Texas's core deed elements: it must be in writing, name a grantor and grantee, contain a legal description, be signed by the grantor, and be delivered with intent to convey. You can go deeper on the mechanics of transferring title, including recording requirements, in the Day One deeds and title transfer chapter. Recording matters just as much as the deed language itself. An unrecorded deed is still valid between grantor and grantee, but Texas's recording statutes protect a later bona fide purchaser or lender who records first without notice of the earlier, unrecorded conveyance — which is why title companies in Texas will not close a sale without confirming the full recorded chain of title at the county clerk's office.

Property Code Section 5.008 requires a seller of residential real property with not more than one dwelling unit to give the buyer a written disclosure notice covering the seller's knowledge of the property's condition. The notice must state plainly that it "is not a warranty of any kind by the seller or seller's agents" and reflects only what the seller knows and believes as of the date it's signed — it is not a substitute for an independent inspection. Section 5.008(b) lists specific transactions exempt from the notice requirement, including transfers under a court order, transfers by a trustee in bankruptcy, transfers resulting from foreclosure, transfers to a spouse or a person within the lineal line of consanguinity, and sales of new construction covered by a residential warranty. Section 5.008 also carves out a narrow but frequently tested protection: a seller has no duty to disclose a death on the property from natural causes, suicide, or an accident unrelated to the property's condition, nor whether a previous occupant had HIV or AIDS. This statute pairs directly with the broader duty of disclosure covered in the seller disclosure obligations chapter, and agents should be able to distinguish Section 5.008's seller disclosure from the licensee-level disclosure duties that TREC's Canons of Professional Ethics impose separately on the agent.

Subchapter D of Chapter 5 governs the executory contract for conveyance — commonly called a "contract for deed" — where a seller finances the sale directly and does not deliver a deed until the buyer finishes paying, sometimes over 10 or 20 years. Texas overhauled this area of law in 2001 and 2005 after widespread reports of buyers losing their homes and all their equity over a single missed payment, and the resulting protections are now some of the strictest contract-for-deed rules in the country. Section 5.062 defines the subchapter's reach: it applies only to executory contracts for property used or intended to be used as the purchaser's residence, and a lot of one acre or less is presumed residential. Critically, the subchapter does not apply if the contract requires the seller to deliver a deed within 180 days of the contract date — a seller-financed sale that closes quickly with a recorded deed falls outside this stricter regulatory regime entirely. Section 5.061 defines "default" narrowly as the failure to make a timely payment or comply with a contract term, which sets the trigger point for the purchaser protections described below. Two purchaser protections come up constantly on practice exams. First, Section 5.077 requires the seller to provide the purchaser a written annual accounting statement every January, itemizing amounts paid, the remaining balance, the number of payments left, and taxes and insurance paid on the buyer's behalf. Second, and arguably the more important protection, Section 5.081 gives the purchaser the right to convert their executory contract into recorded, legal title at any time, without paying any penalty or extra charge — at which point the seller executes a deed and the purchaser simultaneously executes a deed of trust securing the remaining balance, just like a conventional mortgage closing.

Because Chapter 5 buyers have often built substantial equity by the time a default occurs, Texas law does not allow the seller to simply forfeit the contract and keep everything the way older common-law "forfeiture" contracts once permitted. A seller who fails to meet Subchapter D's notice, accounting, or conversion-right requirements can face a purchaser's remedy to cancel and rescind the contract and recover a full refund of all payments made — a far more expensive outcome for the seller than simply following the statute in the first place. This is also where executory contracts intersect with Texas foreclosure practice: once a contract for deed converts to a recorded deed of trust under Section 5.081, any subsequent default is handled through the standard non-judicial foreclosure process rather than contract forfeiture. Agents who work with distressed or seller-financed properties should understand both tracks — see the Day One guide to Texas foreclosure timelines and the related article on first-Tuesday foreclosure sales for how the post-conversion process actually runs.

The Texas sales agent exam draws Chapter 5 questions from two angles: deed classification (matching a warranty level to a scenario, or identifying that a quitclaim conveys no warranty at all) and executory contract fact patterns (recognizing when Subchapter D applies versus when a fast, deed-delivered seller-financed sale escapes it). A common trap is a question describing a seller-financed sale that closes with a recorded deed and deed of trust in 30 days — that is not an executory contract under Section 5.062's 180-day carve-out, even though money changes hands over time through the promissory note. Another frequent test pattern pairs Section 5.008 exemptions against a fact scenario — expect at least one question asking whether a foreclosure sale, an estate transfer, or a builder's new-construction sale requires the Seller's Disclosure Notice. Knowing the exemption list cold, rather than assuming disclosure is always required, is what separates a correct answer from a guess. Chapter 5 also overlaps with contract law generally — for the broader rules governing how any Texas real estate contract is formed and performed, see the TREC-promulgated contract forms article and the texas contracts and forms chapter.

Chapter 5 shows up in practice far more than most new agents expect. Any time you list a property that was previously sold on a contract for deed, you need to confirm whether the seller actually complied with Subchapter D's accounting and conversion requirements — an out-of-compliance executory contract can cloud title and delay closing. And every residential listing you take, outside the Section 5.008(b) exemptions, requires walking your seller through a disclosure notice that is legally distinct from, and stricter than, your own duty of honesty as a licensee. Day One builds fresh, full-length Texas practice exams that mirror TREC's actual weighting on Property Code topics like Chapter 5, so you drill deed classification and executory contract fact patterns in the same proportion they show up on test day, not just once in a passing chapter review. The same logic applies to legal descriptions. A deed with a vague or incorrect legal description can pass an unintended parcel, or none at all, even if every warranty and signature requirement is otherwise satisfied — so agents drafting or reviewing a contract that will feed into a deed should confirm the legal description matches the county's plat or survey exactly, not just the street address on the listing.