Foreclosure happens pretty fast in the State of Texas. Here is a simplified sequence of events leading to foreclosure:
- Homeowner (borrower) misses two payments
- Lender sends a “demand letter” requesting the borrower pay the past due amounts
- After the third missed payment or 90 days, the lender begins the foreclosure process
- The borrower generally has 90 days to work with the lender to settle on payment options or loan modifications
- If all of the above fails, the lender auctions the house off at the courthouse.
If you lose your house to foreclosure, you will also lose any equity you may have had in the house and have your credit ruined for many years to come. Your financial life will be challenging. You want to do everything you can to avoid a foreclosure.
But your house is still your house until it is auctioned off. This means you still have the ability to sell it before the foreclosure happens. But while you may be able to sell your house, you may not receive any cash proceeds at all. To avoid foreclosure, you may even have to take responsibility for a loan to make up your back mortgage payments. It's complicated.