Texas Foreclosure Process
Property foreclosures in the State of Texas are carried out both in and out of court. Compared to most states, it is extremely easy to foreclose on properties in Texas and the process moves very quickly. In some states, the average length of time that it takes for a loan to be foreclosed on, that is from the time a lender files a foreclosure lawsuit or notice of default, can be 10 months or more. However, in Texas, the typical timeline is only 60 days. This means that a homeowner who receives a foreclosure notice has very little time with which to act in order to receive any equity built up in their home, and to save their credit.
Though some credit repair companies might do their best to convince you that your credit can quickly be repaired after a foreclosure (for a nice fee), the fact is that a foreclosure remains on your credit bureau report for seven (7) years; the same length of time as a Chapter 13 Bankruptcy! Don’t believe me? Check the internet site below from Equifax, one of the major credit reporting agencies:
Most foreclosures are “non-judicial”, meaning the mortgage, or “Deed of Trust”, has a “Power of Sale” clause. Most mortgages contain this clause. It pre-authorizes the sale of the property to pay off the balance on a loan in the event of default. This power of sale may be executed by either the lender, or their appointed representative, called a Trustee.
The following provides a brief overview of the steps in the foreclosure process:
1. Lender Mails Demand Letter to Borrower 2. Lender Files Foreclosure Notice (Usually 20 Days after Demand Letter) 3. Foreclosure Sale Takes Place (The First Tuesday of the month, but at least 21 days after Notice of Foreclosure)
For properties in Harris County, the foreclosure sale takes place on the steps of the Family Law Center in Houston. The property is sold to the highest bidder for cash. Anyone may bid, including the lender, who bids by canceling out the balance due on the note, or some part of it.
Your lender may also obtain a deficiency judgment, limited to the difference between the loan balance and the sale price at the foreclosure auction. This means that even after the foreclosure sale, you could still owe money to the lender!
The foreclosure process is damaging in many ways, but there are alternatives. We can make an offer to buy your home and have a Cashier’s Check in your hands within 48 hours, stop the foreclosure process, and keep it off your credit report. Give us a call today!
Sources: www.realtytrac.com, www.foreclosurelaw.org, www.equifax.com
The information provided herein is for informational purposes only and should not be considered legal advice. Every homeowner’s situation is different and an attorney should be consulted to determine how state foreclosure laws, which do change regularly, apply to your specific circumstances.
