Understanding the process of foreclosure in the city of El Paso is important when you find yourself in difficult situations.
Before we go any further…
The Ins and Outs of Foreclosure for Residents of El Paso
Foreclosure: What Is It?
Foreclosure is a legal process lenders use when they want to re-take a home, typically after a borrower ceases making regular payments.
Nobody wants to have their home foreclosed, but if you find yourself in such a situation, be mindful that things aren’t as bleak as they may seem.
When you understand how foreclosure works in the state of TX, you’ll know how to navigate your way through the process. Best of all, you can prepare yourself to come out of the situation on a positive note.
Foreclosure’s Basic Stages
There are several stages involved with the foreclosure process.
Not every state handles foreclosure the same way.
There are a couple of ways states foreclose properties – power of sale and judicial sale.
Get in touch with us today by phone (915) 228-3314, or fill out our contact form. We will help you navigate your way through the foreclosure process, as well as explain how it is handled in the city of El Paso.
Whether the process happens through a judicial sale or a power of sale, foreclosures generally do not make their way to a court until 90 to 180 days have passed where payments were missed. More often than not, lenders will send you notices about your payments being in arrears, whether you are behind on payments or simply overdue.
Under a Non-Judicial Foreclosure (Power of Sale):
- Mortgage lenders will serve you with documentation demanding payment. Courts aren’t involved at this point, though the process might warrant judicial review.
- Once a certain amount of time has passed, a document known as a “Deed of Trust” will be drawn up. From there, control of the property will be transferred to a designated trustee.
- Your property will be sold off by the trustee to a lender at some kind of public auction, though advance notice must be issued.
Under a Judicial Foreclosure:
- A mortgage lender needs to file a suit in court.
- The court will send you a letter demanding payment.
- If the loan has validity, then you will be given one month to make any payments that are in arrears. Doing so will help you bypass foreclosure. The money will need to be brought to court, and you may be able to get an extension on this 30-day duration.
- If no payments are made within a specified period, a lender has the right to ask for your property to be sold through a judgment. The sale will probably happen via an auction.
- After the property gets purchased, a sheriff will serve you a notice of eviction. You will be forced to vacate the premises immediately.
Those who are interested in the home will be notified when either kind of foreclosure transpires.
For instance, banks or contractors with liens on foreclosed properties have the right to collect any auction proceedings.
What Happens When Foreclosure Auctions End?
After completion of a foreclosure, the amount of the loan gets paid off using proceeds from the sale.
Occasionally, if the property is sold at an auction for an amount that doesn’t cover the amount of a loan, then deficiency judgments may be issued directly against a borrower.
Deficiency judgments are when banks get a judgment against a borrower (you) for outstanding funds that are owed, post-foreclosure sale.
Many states place limits on amounts owing when it comes to deficiency judgments. Such amounts are limited to fair property value when the sale is made. Other states let the full amount of the loan to be evaluated against a borrower.
The following resource list reveals deficiency judgment regulations in each state. View List Here.
For the most part, it is prudent to bypass foreclosure auctions. Instead, get in touch with your bank or hire a real estate firm (such as Level Cash Home Offers, LLC) with a strong reputation. They can help negotiate reductions of amounts owing in order to bypass a foreclosure.
Professional investors will negotiate with banks directly in order to reduce the amount owing on a sale. They may even be able to help you eliminate it, though this is contingent on the home being worth much less than the amount owing.
We have purchased properties in the city of El Paso from homeowners who needed a fast sale for cash.
Give us a call anytime (915) 228-3314 or
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Another Foreclosure Resource For El Paso TX HomeOwners: