How does Deed of Trust to Secure Assumption work when a bank holds a mortgage on said house

In most states, a "first mortgage" means that the mortgage has the first priority, over any other lien on the property other than for taxes.  And in most states, first in time means first priority.  If the property is sold, the lien priority is the order in which they have to be paid.  This is a large part of the paperwork and preparation for a real estate closing, because the buyer's mortgage lender needs to make sure that it will have that priority -- which means all existing liens have to be found and paid off.

So, it sounds like the law firm might be able to foreclose and force a sale, but the mortgage still gets paid first.

I'm not a Texas attorney, and the law varies from this in some states;  facts that you haven't included could affect this.  So, for reliable advice, you need to get all the facts of the situation in front of a qualified attorney in your area.  One place to find a lawyer is our website, http://attorneypages.com