Affidavit and Indemnification Agreement (Redeeming Lienholder)

Purpose of Form
The purpose of this form is to assist you in allowing a lienholder of a vehicle, trailer, boat, or outboard motor to redeem property prior to a foreclosure sale. Under the special foreclosure procedure for motor vehicles, boats, trailers, and outboard motors, you must mail the Notice of Intent to Sell to owners and lienholders of record within 30 days after mailing the Notice of Claim form to the tenant, so you will want all the information back from TXDMV/TPWD within 30 days after you mail the Notice of Claim. Lienholders or owners of record to whom you send this notice have a statutory right to obtain possession of the motor vehicle, trailer, boat, or outboard motor by paying all charges owed to you by your tenant within 31 days of the date you mailed the notice.
If you have an owner or lienholder (you will discover this information when you do your TDMV or Texas Parks and Wildlife Department inquiry) who wishes to redeem the property within 31 days of the mailing of this notice, you may have the owner or lienholder sign this form. By signing this form they affirm that they are the owner or have a lien, and agree to indemnify you for any damages that come about as a result of the tenant claiming that they should not have been allowed to redeem. Damages are probably quite unlikely, as the lienholders and third party owners have a statutory right to redeem during this 31-day period, but having the lienholders sign the form is a good precaution.

When to Use
This form should be used when you are performing a Chapter 59 foreclosure on a vehicle, trailer, boat, or outboard motor, and a registered owner or lienholder wants to redeem the property within 31 days of your mailing of the notice of intent to sell.

Tips for Use
You should make sure that any person or entity claiming to be a third party owner or lienholder is, in fact, an owner or lienholder according to TXDOT or Texas Parks and Wildlife Department records. You can ask for identification if you wish. If someone is claiming to be a representative of a company (for example, if a company is the lienholder), you would be well served to make sure that he is a duly authorized representative (get something in writing from an officer of the company stating that he has the authority to act for the company). Also, if the lienholder is an entity, make sure that the legal name of the lienholder is printed in the signature line and that the person signing on behalf of the entity signs as an agent of the entity. This document should be notarized as well, as an extra precaution.

There is no legal requirement for the redeeming owner or lienholder to sign this form, but it can give you "insurance" and peace of mind that the redeeming lienholder is who he says he is, and that he will indemnify you for damages claimed by the tenant (however unlikely a claim like this would be).

As a practical matter it would be unusual for someone to "impersonate" a lienholder and attempt to redeem the property. The only ones who know about the sale—the only ones who have received your notice of intent to sell—are the tenant himself, and the owners and lienholders of record.