In the state of Texas, most lenders insert a power-of-sale clause into a mortgage contract that allows the lender to sell a mortgaged property without a court order, known as a non-judicial foreclosure. If the mortgage does not contain a power-of-sale clause, the process usually takes longer, because the lender must obtain a court order to foreclose on a property. Time frames vary depending upon a Texas homeowner’s (borrower’s) individual circumstances.
An uncontested non-judicial Texas foreclosure takes an average of 60 days and a default judgment for a judicial foreclosure takes an average of 90 days. Since lenders have to hire an attorney to foreclose upon a home and borrowers can be backed up due to a large volume of foreclosures, the total amount of time from the borrower’s default to the sale of the home can take six months or more.
Texas homeowners can delay the foreclosure process further by requesting that lenders prove that they own the debt and filled out all paperwork properly to comply with federal and state law. Due to the sale of mortgages on the secondary market, the process of locating loan paperwork can take months. In addition, borrowers can request delays in the court process or file for bankruptcy in order to extend the foreclosure process even further into the future.
Regardless of the type of foreclosure, a lender must send a notice to the Texas borrower and allow him 20 days notice to become current on his past due mortgage payments and penalties. With a non-judicial foreclosure, the lender can foreclose upon the property by filing a notice of the foreclosure with the county clerk in the county in which the property is located. With a judicial foreclosure, the lender will have to file a suit in a local court, and it can take up to a month before the court date occurs.
The lender must then publish notice of a foreclosure sale for a minimum of 21 days (three weeks) in a local newspaper. This notice will include the date on which a trustee of the lender will auction off the property. A lender can complete a foreclosure in as short as 41 days if the homeowner does not contest a non-judicial foreclosure. After the trustee sells the property at auction, the new owner of the property can legally evict the homeowner. All sales are final, meaning that the original owner of the property cannot redeem the property after the auction, according to Stop Foreclosure Services.