How to Fight Foreclosure in Texas
Foreclosure is often devastating, regardless of the circumstances, and is even more traumatic when it happens quickly. According to Realty Trac, it is extremely easy for lenders to foreclose in Texas, expediting the process. However, several federal and state programs can provide assistance to struggling homeowners. Whether you are concerned about your future ability to meet your monthly mortgage payment obligation or are currently behind, seeking help can keep you in your Texas home. By following the proper steps, you can lower your mortgage payment, reach an acceptable agreement with your lender or find a suitable alternative to foreclosure.
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Call your lender. The best way to fight foreclosure is to avoid it completely. You may be able to avoid foreclosure on your Texas home by communicating with your lender before the foreclosure process is instigated. If you are current on the loan, refinancing at a lower interest rate can reduce your payment. Homeowners who suffer a hardship should apply for a forbearance to delay payments. A repayment plan helps homeowners by allowing the missed payment to be repaid through monthly installments. Inquire about the federal Making Home Affordable (HAMP) program, which can help you avoid foreclosure by reducing your monthly payments and eradicating past-due amounts. If you qualify, your loan will be modified to a lower interest rate and monthly payment, even with a past-due balance, and the foreclosure process is averted.
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Seek assistance from a foreclosure prevention counselor. A HUD-approved counselor can review your loan and locate assistance programs, including HAMP, based on your eligibility. Counselors are also able to speak to your lender to renegotiate the loan on your behalf. The Texas Foreclosure Prevention Task Force was implemented to tackle the foreclosure crisis, holding workshops throughout Texas to educate homeowners and provide counseling services. HUD provides a complete list of additional foreclosure counseling agencies.
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Contact a pro bono attorney. Many agencies provide free legal advice and representation to low- and moderate-income Texas homeowners. The attorney will likely need to read your mortgage documents to check for discrepancies and to determine the procedure the lender must follow to foreclosure the property. If the lender does not follow proper procedures, the process can be delayed. Lonestar Legal Group and Legal Aid of Northwest Texas offer pro bono services. Visit the HUD website (see Resources) for a complete listing of legal aid service providers.
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Consider filing bankruptcy. In Texas, If you file Chapter 13 bankruptcy, you opt to keep your home, provided you continue making your current payments. You will also be required to pay the delinquent amount of the loan through a court-supervised repayment plan. Once you file bankruptcy, an automatic stay will be issued and creditors must halt collection activity. To fight a foreclosure while in a Chapter 7 bankruptcy, you must catch up on delinquent mortgage payments. If you are unable to bring the mortgage payments current, your lender can request that the court lift the automatic stay to proceed with the foreclosure. Bankruptcy will significantly impact your credit for at least seven years. Evaluate your options and meet with an experienced bankruptcy attorney before filing.
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