Understanding The Beginning of the Foreclosure Process In Texas

Colby Hager on September 1, 2022

Understanding The Beginning Of The Foreclosure Process In Texas

One of the most difficult experiences a homeowner can go through is foreclosure. It can be financially and emotionally devastating, and it can damage your credit for years to come. If you’re facing foreclosure in Texas, it’s important to understand the process so that you can take the necessary steps to protect your rights.

If you wait too long, you may find yourself in a situation where you are unable to sell your property and are forced to move out. With this in mind, it is important to be aware of the foreclosure process in Texas so that you can take action to prevent it from happening to you.

The Beginning Steps To A Foreclosure In Bexar County

The first step in the foreclosure process is known as pre-foreclosure. This is when the lender sends a notice to the borrower informing them that they are behind on their payments and that they need to catch up within a certain period of time or face foreclosure.

If the borrower doesn’t catch up on their payments, the next step is a Notice of Default and Intent to Accelerate, which is sent by the lender informing the borrower that they have failed to make their payments and that they have 30 days to catch up or face foreclosure.

If the borrower still doesn’t make their payments, the next step is a Notice of Acceleration and Posting of Foreclosure, which is sent by the lender informing the borrower that their home will be sold at a foreclosure auction in 21 days. At this point, the borrower has two options: they can either try to sell their home to prevent foreclosure or they can let their home be sold at auction.

What Is A Pre-Foreclosure In Texas?

When a homeowner misses 3-6 months of mortgage payments, the lending institution will issue a warning, notifying the homeowner to pay or lose their home. This period is known as “pre-foreclosure.”

Banks and mortgage lenders typically provide three months for the homeowner to become current. Of course, this number can vary by bank and situation sometimes.

If a homeowner fails to make the necessary payments, the bank will foreclose on the home, assuming ownership, and evict the homeowner. Thankfully, during this stage of the foreclosure process, a mortgage holder has the opportunity to take advantage of several options to prevent losing their home.

What Is A Notice of Default?

The “Notice of Default and Intent to Accelerate” gives formal notice about the borrower’s default. This allows them an opportunity (at least 20 days) for curing it, although most substitute trustees handling foreclosures for banks in Bexar county feel that 30 days to cure is the safest way to ensure a proper foreclosure is being conducted.

The notice of default is a very important step within the foreclosure process that gives people with an interest in the property to step forward and claim their rights – before it’s too late. If you’ve received a notice of default, don’t wait. Time is definitely of the essence, and you should take action.

Options Available To Homeowners At The Beginning Of The Foreclosure Process

You may be able to quickly sell your home to a reputable real estate investor in San Antonio TX like Capstone Homebuyers

We use cash to pay the months of back-payments owed (or we *may* be able to work out something with the lender that relieves all or part of your back payments). We can buy your San Antonio area home quickly, often in just a week or two, will pay in cash, and takes the stress out of trying to find a buyer.

You can contact the bank and ask them to permit a short sale

In a short sale, you’ll sell your home for less than it’s worth, and the bank will take the loss as a tax write-off. In some short sales, you may still be required to pay the difference to the bank if the house doesn’t sell for what is owed on the loan.

You may be able to declare bankruptcy

Bankruptcy can buy you time to pay your debt. Bankruptcy will remain on your credit report for years and can cause significant damage. There are some risks that go along with this strategy so make sure you understand the pros and cons of filing bankruptcy to avoid forclosure.

Request a loan modification

This is when the bank will allow you to wrap your back payments into your loan or tack them onto the back end of your loan. While this option can save you from moving closer to a foreclosure, it can be costly at the end of your loan.

Be Aware Of Foreclosure Scams

If you’re in foreclosure and are looking for a solution to avoid foreclosure and get foreclosure help in Bexar County TX, here are some “solutions” some less-than-honest companies may offer and what you need to watch out for.

Charging upfront fees to get mortgage assistance from lenders. Fannie Mae says, help is free. Some companies will try to charge you for talking with your lender about your mortgage to find a solution. Don’t fall for it; this is one of the classic foreclosure scams. You can talk with your lender about the mortgage and your options anytime with no charge, or work with a company that will do your loan counseling for you for free.
Signing over the deed to your home at your kitchen table. Never sign over the deed to your house unless you’re working with your mortgage company to forgive your debt… unless you’re physically selling your house to that company. If that’s the case, ask the company to do everything at a reputable attorney's office so everything is on the up and up (always consult legal advice before ever signing over your deed).
Try to say you don't need to work with a professional or have an attorney handle the paperwork. Selling your house, whether you’re in foreclosure or just need to sell quickly, should be done with the help of certain professional services. With every house we buy, we always use a neutral 3rd-party title company to handle the closing, drawing up the closing documents, and all related paperwork.

Sell Your House To A Reputable San Antonio Based Company

You’re about to lose your home and you don’t know what to do. You’ve tried talking to your bank, but they won’t help you.

We can help people avoid foreclosure at the last minute. If your house is facing foreclosure in days, we have solutions that can help you prevent foreclosure.

Foreclosure doesn’t have to be inevitable. Capstone Homebuyers offers solutions that can help people save their homes at the last minute. Contact us today for more information.

Can Bankruptcy Be Used To Stop Foreclosure In Texas?

Colby Hager on April 15, 2022

Yes. Bankruptcy can be used to stop foreclosure in Texas and bankruptcy is often used as a tool by homeowners in order to prevent a foreclosure. Using bankruptcy to stop foreclosure is a powerful tool but can often be costly. Many homeowners who are facing foreclosure see bankruptcy as a way to stop foreclosure without thinking about what happens after they file for bankruptcy. If you enter into bankruptcy without a plan or without a solid long-term strategy, it could backfire. At Capstone Homebuyers, we have been buying houses in bankruptcy and helping homeowners stop foreclosure for years in San Antonio Texas and we are ready to help if needed.

How Long Will Bankruptcy Delay Foreclosure

Bankruptcy can delay a bank foreclosure for years if successful. Bankruptcy can delay a foreclosure by a month or two if it is used by a homeowner only as a means of stopping foreclosure.

Different types of bankruptcies come with different types of rules. If you are looking for a long-term strategy, entering into bankruptcy can buy you three to five years. This is assuming you make your monthly payment arrangements created during your bankruptcy hearings. If you are looking for a more temporary solution, you will likely file a bankruptcy to stop the foreclosure but then abandon the foreclosure process once you have found a solution for selling your home quickly to avoid the pending foreclosure.

What Happens If My House Isn’t Covered By Bankruptcy

Bankruptcy doesn’t protect your house from foreclosure permanently. In fact, when the only goal of bankruptcy is to stop foreclosure, you can lose protection quickly. Lenders can appeal and file a motion to dismiss, the bankruptcy judge also has discretion and may not allow your home to be covered by bankruptcy. If any of these scenarios happen, you will be scrambling to sell your house fast so that the house isn’t sold at the foreclosure auction because the lender will resume the foreclosure process right away. If you find yourself in this type of situation, make sure and find a reputable cash home buyer with experience buying houses in bankruptcy and foreclosure. A company like ours, Capstone Homebuyers, has dealt with this issue many times and can act quickly and appropriately, and has the resources to be able to help.

When Is It Too Late To Stop Foreclosure with Bankruptcy

Using bankruptcy as a last-minute option to stop foreclosure is possible up until the house is sold at the foreclosure auction. There has to be time for your bankruptcy attorney to file the case with the bankruptcy court and there will be documentation needed from you and forms that you will have to fill out along with attorney and filing fees. Some of the items you will want to be prepared for are the following:

Knowing that the foreclosure auction happens on the first Tuesday of every month in Bexar county, the absolute latest you could possibly hope to get a bankruptcy filing done and an automatic stay in place would be Monday, the day before the foreclosure auction is held. If your plan is to only use bankruptcy as a temporary delay tactic, make sure you start working with your preferred home buyer immediately. An experienced and qualified home buyer will work with your attorney to make sure everything is in place so that you can sell your home without delay.

Selling Your House During Bankruptcy

Selling your house during bankruptcy is always an option. Sometimes that is the plan from the very beginning and bankruptcy is used as a tool to buy you time. Occasionally, bankruptcy is the long-term strategy but it isn’t approved or your home isn’t covered or protected by the bankruptcy. And sometimes, you are years into your bankruptcy repayment plan and life happens and you need to sell your house that is covered by bankruptcy protection. If any of these scenarios happen, make sure you work with the right kind of home buyer. A home buyer with a great reputation as well as the experience necessary to properly help and guide you through the process. If you would like to know more about working with Capstone Homebuyers, we are always available to help…even if we don’t buy your house, we pride ourselves on helping members of our community.

Sell Before Foreclosure

Selling your house before a foreclosure without using bankruptcy is often a very good option. If you can’t pay a bankruptcy attorney, for example, you may just decide to sell instead of stalling the foreclosure for a short period of time. If you find yourself in a complicated foreclosure or bankruptcy situation, give Capstone Homebuyers a call. We will go over all of your options and make a recommendation free of charge. If it turns out selling your house is the best option, we will give you a fair offer that you can count on to help you out of your situation.