You’re in default — now what?

Posted by Keller Home Solutions in Avoiding Foreclosure | 0 comments

You didn’t intend for it to happen.

One missed mortgage payment snowballed into months of missed payments, and now you’ve received a Notice of Default letter.

Timelines

Texas has one of the fastest foreclosure processes in the country. It can be as quick as 60 days, whereas the US average is 720 days.

Texas law states that lenders must wait until you are 120 days delinquent before sending an official written Notice of Default. The notice will allow you 20 days (some loans allow 30 days) to “reinstate” your loan, meaning you can catch up on your missed payments and prevent foreclosure.

After the 30 days are up, the lender will send a foreclosure notice, called a “Notice of Trustee’s Sale.” The lender must give you at least 21 days notice of the sale.

Options

If you haven’t already had that tough conversation with your lender, NOW is the time to discuss your options.

There may be some alternatives, such as negotiating a payment plan, a temporary forbearance, or a loan modification. A HUD-approved housing counselor can also provide assistance to avoid foreclosure.

Selling Your Home

If you’ve exhausted all repayment options, accept the fact that it’s time to let go of your home.

Selling your home is a way to avoid foreclosure that gives you some control.

When you are on a tight foreclosure deadline, a cash sale is a good option. These sales can close in a matter of days versus weeks for sales requiring financing. Keller Home Solutions is an Austin-based investor with local market experience. We can offer you a fair market price on your home, all in cash and with a quick turnaround time.

Last Resort

Filing for bankruptcy is not ideal, but it can stop a foreclosure in its tracks. In some cases, it can help you to keep your home.

Chapter 13 bankruptcy can help you keep your home while you repay your debts. If you don’t want to keep your home but need to buy some time, filing for Chapter 7 bankruptcy can delay foreclosure for a few months.

Bankruptcy is a last resort because it stays on your credit report for seven to 10 years, which makes it difficult to get another loan or even rent an apartment. Similarly, a foreclosure will stay on your credit report for seven years.

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