What Happens After A Home Foreclosure in Texas
The impact of a foreclosure is felt leading up to the foreclosure, during the foreclosure process, and after the foreclosure as well. Some of the after-effects of a foreclosure are well known such as damage to your credit score. However, there are other effects that come after a foreclosure as well. This article will cover what happens after a home foreclosure in Texas.
Can You Stay In Your House After Foreclosure?
Once the process of the foreclosure has run its course and the foreclosure sale has actually occurred, you will likely have to move soon. However, you could be allowed to stay for a surprisingly long period of time. Depending on the new owner and what their plans are, they may not show up and have you move right away.
Sometimes the new owner will actually pay you to move out by a certain time. This is known as “cash for keys” and happens quite frequently. Just be aware, that not every new owner uses this technique. Some go straight to eviction or changing the locks.
You can also try to rent the property back from the new owner. This has worked for more than a few people who fell on hard times and had their property foreclosed on. While not very common, it is a possibility worth exploring if you want to stay in your house after foreclosure.
Can You Get Your House Back After Foreclosure?
Many people wonder if they can get their house back after the final foreclosure sale. Unfortunately, after the court rules in favor of your lender and allows the lender to proceed with foreclosure, it is very hard for you to get your house back.
The best thing you can do right now is to educate yourself on your options for preventing the foreclosure from happening in the first place so you don’t have to worry whether or not you can get your house back after the foreclosure.
The Loss Of Your Home After Foreclosure
The loss of your home is one of the most obvious things that happens after a foreclosure. You will no longer have a place to live and will have to move out. This can be very difficult, especially if you have family or other attachments to the home.
The loss of your home also means the loss of any equity that you had in the home. This is money that you have invested in the property over time. There are steps you can take to avoid foreclosure completely before it’s too late.
Foreclosure Will Damage Your Credit
Having a foreclosure appear on your credit reports will make you appear to be a bad risk to future lenders. This could impact purchasing power and opportunities for loans or mortgages that are available to an individual. Interest rates associated with those financial institutions that are willing to accept a poor history of payment compliance often result in exorbitant fees being charged (or even getting denied altogether). It could also affect employment prospects if employers see you primarily through this lens.
While most people understand that a foreclosure will negatively impact their credit score, they don’t realize how much of an impact a damaged credit score can have on their day-to-day lives. When you understand the complete impact of a foreclosure, you begin to really understand why some people even choose to use a bankruptcy to stop a foreclosure from happening.
Problems Finding Housing After Foreclosure our Credit
Difficulty finding housing after a foreclosure is common. If you are looking to rent a home or an apartment, most property management companies utilize credit scores as a big part of the deciding factor on who to rent to. If your credit score has been severely damaged, you could miss out on more desirable housing opportunities.
If you are hoping to purchase another home in the future, having a foreclosure in your past can hurt your options for borrowing money. A foreclosure stays on your credit report for 7 years. This means that you will be subject to denials and high interest for quite some time after the foreclosure.
Because of the potential issues with finding housing after a foreclosure, many people look for options on how to prevent the foreclosure from happening in the first place.
You Could Owe Extra Taxes After A Foreclosure
If the home is sold at the foreclosure sale for less than what is owed to the lender, you can be held responsible for the taxes on the difference. If the lender forgives the deficient amount, this is considered income according to the IRS and they will tax you on this amount. This means you could be responsible for extra taxes after the foreclosure.
Did You Know You Could Still Owe Money to the Lender After A Foreclosure?
If the home sells at the foreclosure auction for significantly less than what you owe on the property, the lender may choose not to forgive the deficient amount. If this happens, they could pursue a deficiency judgment. If the lender is successful in getting a deficiency judgment, it’s something that will follow you until it is paid.
Emotional Effects After A Foreclosure
Your mental health is at stake after foreclosure because of the high-pressure situation you have gone through. Going through a foreclosure is emotionally exhausting and frustrating, to say the least. Many people experience anxiety, depression, and even suicidal thoughts. If you are having any of these thoughts, it’s important to get help from a professional.
It’s also common to feel like you have failed after a foreclosure. You may feel like you let your family down or that you are not good with money. These are common feelings, but it’s important to remember that a foreclosure is not a reflection of you as a person. It’s simply a situation that you have found yourself in.
Consider Your Options To Avoid Foreclosure in the First Place
If you’re facing foreclosure, then you know how stressful and scary the situation can be.
But did you know that there’s a way to stop a foreclosure before it’s too late? Capstone Homebuyers is here to help. We buy houses fast and give cash offers, so even if your house is about to be foreclosed on, we can help.
We’re confident that we can help prevent foreclosure and help you keep your home. So don’t wait – call us today and let us help you get through this difficult time. We will cover all of the options we know of that are available to you so that you don’t have to experience what happens after a foreclosure sale.