In Texas, as elsewhere, a promissory note is the most enforceable form of consumer or commercial debt instrument. On paper the lender’s case is straightforward: the note proves the obligation, the payment history proves default, the math proves the amount, and the burden shifts to the borrower to raise a recognized defense. Structurally, suit on a note is a summary-judgment matter.
The same goes for a written guaranty. The guaranty proves the guarantor’s secondary obligation, the underlying default proves the trigger, and the math proves the amount. Most guarantor defenses fail under the language of modern guaranty forms.
What actually decides whether the suit produces a quick summary judgment or stalls into prolonged litigation is the work done at the front end: the affidavit and documentary record built into the motion, the anticipation of the borrower’s likely defenses, and clean execution of the motion practice.
We have prosecuted notes and guaranties in Texas as a regular part of our practice since 1994. This page describes how we approach them.
When We Sue on a Note
Our note-and-guaranty practice handles:
- Single-borrower commercial notes with one or more guarantors
- Multiple-borrower notes, often joint ventures or co-signors
- Modified or restructured notes, both where the modifications strengthen the lender’s position and where the borrower contests them
- Lines of credit and revolving notes, where the balance computation is more complex than a simple installment note
- Notes in default following partial payment, where the matured balance and accrued interest have to be carefully supported
- Notes where the original obligor has filed bankruptcy and only guarantors remain, with collection continuing against the guarantors
- Notes where the borrower has died, with collection proceeding against the estate (if probate is open) and against guarantors
- Out-of-state notes that need to be enforced in Texas, or Texas notes that need to be enforced elsewhere
Building the Summary-Judgment Record
Our typical summary-judgment package includes:
The note itself. Original or certified copy. We prefer the original where it’s available, because some borrowers raise authenticity challenges that the original disposes of.
Each guaranty. Original or certified copy. Where the guaranty was on the same instrument as the note (a single document combining note and guaranty), we produce the document showing the guarantor’s signature and the guaranty terms.
Affidavit of indebtedness. Sworn testimony from a custodian of the lender’s records establishing the loan, the payment history, the default, and the resulting balance. The affidavit is supported by attached business records (the actual payment ledger, bank records, statements) authenticated under the business-records exception to hearsay.
Affidavit on attorney’s fees. Where the note or applicable statute authorizes attorney’s fees, an affidavit from the firm establishing the reasonableness and necessity of fees.
The motion itself. The legal argument combined with the supporting affidavits and exhibits, set for hearing on appropriate notice.
Anticipation of defenses. When we know from pre-suit communication or the borrower’s answer that a specific defense is coming, we tailor the affidavit and documentary record to dispose of it. Common preemptive content includes proof that no oral modification occurred, evidence of consideration, evidence of the borrower’s acknowledgment of the balance, and rebuttal of any specific factual assertions in the borrower’s answer.
In our experience, a properly built summary-judgment record disposes of the typical note suit within 4 to 6 months of filing, often faster.
Defeating Guarantor Defenses
Guarantors facing personal liability raise a recurring set of defenses. We have prevailed against each of them in summary-judgment proceedings.
“I never signed the guaranty.” An authenticity challenge. The original document disposes of it, and where the dispute is contested, handwriting expert testimony does. Affidavit testimony from those who witnessed the signing, or whose records show it, also serves.
“The guaranty lacks consideration.” This almost always fails on commercial guaranties signed contemporaneously with the underlying loan, where the loan itself is the consideration for the guaranty. The document chronology disposes of it.
“The guaranty was modified or terminated.” Fails on guaranties with broad waivers of modification defenses. We review the specific guaranty language at intake, and modern guaranties almost always contain language that defeats this defense.
“The lender released me by impairing the collateral.” Fails on guaranties with broad waivers of impairment-of-collateral defenses. Where the guaranty is older or has carve-outs, we build the commercial-reasonableness record to defeat the defense on its merits.
“I’m released because a co-guarantor was released.” Depends on whether the guaranty preserved the lender’s right to release co-guarantors without affecting the remaining guarantors’ liability, which most modern forms do.
“I was fraudulently induced to sign.” Requires specific evidence of misrepresentation by the lender. Almost always fails absent contemporaneous documentation of the alleged misrepresentation.
“The lender modified the loan without my consent.” Fails on guaranties with consent-to-modification waivers, which most modern forms include.
“The borrower’s bankruptcy releases me.” Fails as a matter of law. The principal’s bankruptcy does not generally release guarantors.
[Link: Defeating Guarantor Defenses]
Modified and Restructured Notes
Restructured loans add complexity. The original note has been modified by later agreements: extension agreements, forbearance agreements, restructured payment terms, additional collateral, additional or substituted guarantors. The lender’s claim is on the modified obligation, which means proving up the chain of modifications.
The common issues are:
- Authenticity of each modification document
- Consideration for each modification, typically the lender’s forbearance from immediate enforcement
- Effect of modifications on guarantors who did not consent, handled through guaranty waiver language or by re-signing
- Calculation of the matured balance after multiple modifications
We handle this complexity routinely. The summary-judgment package includes the original note and each subsequent modification, with affidavit testimony establishing the chain.
Notes With Acceleration and Maturity Issues
Most notes contain acceleration clauses, so the entire balance becomes due on default. Acceleration usually requires notice and an opportunity to cure, depending on the note’s specific terms and applicable statute.
The common acceleration disputes are:
Notice content. Was the notice sufficient as to content under the note’s terms?
Notice delivery. Was notice properly delivered?
Opportunity to cure. Was the cure period adequate, and did the borrower fail to cure?
Continued acceptance of payments after default. Did the lender’s acceptance of partial payments after default waive the right to accelerate?
These are factual disputes that we address in the summary-judgment record. Most are disposed of by careful documentation of the lender’s acceleration process and notice delivery.
Note Defaults Where the Original Lender Has Sold or Assigned the Note
We sometimes represent purchasers or assignees of notes, including collection agencies, debt buyers, successor lenders, and FDIC and similar receivers. Suit on an assigned note requires proof of the assignment and the assignee’s standing to enforce.
The common issues are:
Chain of title. A clean chain from the original lender to the current holder, supported by allonges or assignment documents.
Capacity of the original lender. Where the original lender has been acquired, merged, or placed in receivership, capacity to assign must be supported.
Authority of the assignee. This matters especially where the assignee is itself an institution that has changed form.
We handle these issues as part of regular note practice. The summary-judgment package includes the assignment chain and supporting authentication.
Post-Judgment Enforcement on Note Judgments
We enforce a note judgment with the standard Texas post-judgment toolkit: abstracts, post-judgment discovery, garnishments, executions, turnover orders, and contempt where required. Our note-and-guaranty work integrates directly with our broader post-judgment enforcement practice.
For guarantors specifically, the guarantor’s personal assets are often more accessible than the original borrower’s. The original borrower, usually a business entity that has failed, may be empty, while the guarantor’s non-homestead real estate, bank and brokerage accounts, non-exempt vehicles, and interests in other entities are often substantial and reachable.
Move on the Note
A note in default does not get easier to collect over time. As the months pass, borrowers spend down their assets and guarantors move holdings out of their own names, the risk of a bankruptcy filing grows, and the limitations period keeps running.
If your institution has notes or guaranties in default, contact the firm. Bring the documents, the payment history, and whatever you have on the borrower and guarantors, and we’ll evaluate the matter and outline the path to judgment and recovery.
Contact us to get started or call 214-368-4686.
Related Pages
- For Lenders and Financial Institutions
- Pursuing the Deficiency After Collateral Liquidation
- Defeating Guarantor Defenses
- Personal Guaranty Enforcement
- Coordinating With Bankruptcy Counsel
- Collecting Judgments in Texas
- Texas Collections Law FAQs
Note and Guaranty FAQs
How quickly can the firm move on a note default?
Most note matters can move from intake to filed suit within 30 days, often faster. The summary-judgment motion typically follows the borrower's answer (or the expiration of the answer deadline) by 30 to 60 days. From there, the court's docket controls the timeline to hearing and ruling.
What if the borrower disputes the balance?
At summary judgment, the borrower has to raise a genuine fact issue on the balance, and a general denial is not enough. The borrower has to produce evidence, usually affidavit testimony or documentary evidence, that contradicts the lender's calculation. Most borrower balance disputes don't survive the summary-judgment standard.
What if the original note has been lost?
Texas has a procedure for enforcing a lost note. The lender has to establish ownership of the note, that the loss was through no fault of the lender, that the borrower's right to set up defenses is not impaired, and that the lender provides adequate protection against double payment. We have handled lost-note matters where the underlying records support the elements.
Can the firm enforce a note with a co-signer who is not a guarantor?
Co-signers and co-makers are typically jointly liable on the note itself, and we pursue all signatories. The distinctions between guarantors and co-makers affect some defenses but not the general path to judgment.
What if the note's interest calculation is disputed?
We review the interest computation at intake. Texas usury statutes impose ceilings, the note's specific terms govern within those ceilings, and default-rate provisions may apply post-default. Our summary-judgment affidavit walks through the interest calculation in detail.
Are there limitations issues on note suits?
Texas limitations on suits on written contracts, including notes, is generally four years. The clock usually starts at default or maturity, depending on the note's terms. We track limitations carefully on each matter, especially for older notes.
What if multiple guarantors are joint and several?
We pursue all of them jointly and severally. Recovery from one reduces, but does not extinguish, the others' obligations. We track recovery against the judgment balance.
What if the guarantor is the borrower's spouse?
Spousal guaranties are enforceable in Texas, and recovery against community property is generally available. Some spousal guaranties signed contemporaneously with the underlying loan are subject to specific consumer-protection rules, and we evaluate those on a matter-specific basis.
Does the firm handle FDIC and successor-institution note matters?
Yes. We have handled note matters as counsel for purchasers, assignees, and successors of notes from various sources, including failed-institution receiverships. The chain-of-title and assignment work is part of our regular practice.
What does the firm charge for note-and-guaranty work?
Note matters are usually handled hourly, with the cost concentrated on the summary-judgment package and post-judgment enforcement. For some matters, contingency or modified-contingency arrangements make sense. We discuss the fee structure at intake on a matter-specific basis.