Texas law allows lenders to foreclose rather quickly since the nonjudicial method is used. This is when the lender sends a notice of default 20 days after the payment is past due and soon after sends a notice of sale. A homeowner can lose his home to foreclosure within as little as 60 days.
Texas doesn't have the right of redemption where the former owner is allowed to buy his home back after the foreclosure is finalized. To stay in his home, the homeowner must stay out of foreclosure. If payments fall behind and the foreclosure process begins, there are several ways to stop it.
Contact Your Lender
Call the mortgage company. The fastest way to stop foreclosure in Texas is to call the lender and work out a payment plan to get you current. If you lost your job, then the lender may consider a forbearance, which is where the payments are suspended for a short amount of time.
In few cases, a lender will even lower the interest rate for a certain period of time depending on the income and the loan agreement. Some homeowners are under an adjustable rate loan, which means after several years the mortgage interest rate may go up.
Refinance the Home
The current lender may approve you for a refinance. Some Texas lenders have tried to work out loans for struggling homeowners. Lenders may look at the debt-to-income ratio and overlook some of the bad credit created by the late mortgage payments to get you refinanced.
Talk With a HUD Representative
This is one of the best ways to receive assistance and stop foreclosure in Texas. An adviser from HUD will discuss your situation and help you develop a payment plan to coordinate with your lender. Sometimes the HUD adviser will contact the lender for you if you have a difficult time working out a payment plan.
Sell the Home
A short sale is a way to sell your home quickly without the damage of a foreclosure on your credit report. A short sale is a sale that can take place within 2 weeks. You can also sell the home in a longer period of time as long as you inform your lender, and the lender agrees. Lenders prefer to get their money so they will probably agree with the sale.
Pay the Money Owed
If you figure out a way to pay your mortgage up to date, then the foreclosure will stop. This will require all of the interest and late fees along with the late mortgage payments.
Many lenders have been asked by the federal government to prolong the steps in foreclosure. Yet Texas will still foreclose in 60 days if the borrower doesn't contact the lender.
- HUD: Avoid Foreclosure: Texas
- Texas Department of Housing and Community Affairs: Foreclosure Prevention Resources for Homeowners
- Lawsuit Legal: The Texas Foreclosure Rules: How It Works In The State & The Tricks Lawyers Use to Fight Back
- Clean Slate Homes: How To Stop Foreclosure On Your House
- LegalMatch. "Foreclosure Alternatives." Accessed June 20, 2020.
- Cornell Law School Legal Information Institute. "Foreclosure." Accessed June 20, 2020.
- NOLO. "Homeowners’ Associations (HOAs & COAs)." Accessed June 20, 2020.
- Consumer Financial Protection Bureau. "How Does Foreclosure Work?" Accessed June 21, 2020.
- U.S. Department of Housing and Urban Development. "Are you at risk of foreclosure and losing your home?" Accessed June 21, 2020.
- Cornell Law School Legal Information Institute. "Equity of Redemption." Accessed June 21, 2020.
- FindLaw. "Regaining Ownership After Foreclosure: Statutory Redemption." Accessed June 21, 2020.
- Many lenders have been asked by the federal government to prolong the steps in foreclosure. Yet Texas will still foreclose in 60 days if the borrower doesn't contact the lender.
Laura Hageman has written varied articles on real estate to entertainment topics for the past three years. Hageman wrote a romantic comedy novel entitled Her Desire listed on ebookmall.com. She has written for Web sites such as CurrentForeclosures and Triond over the course of 7 years. Hageman holds a Bachelor's degree in Arts.