Navigating the challenges of unexpected life events can be tough, and foreclosure is one such hurdle that may seem overwhelming. The good news is that there are several avenues to stop foreclosure, eliminate debt, and safeguard your credit.
Key Takeaways:
- Texas does not have any current mortgage relief or mortgage assistance programs
- Once you receive a notice of default from your lender you have 20 days to work out a solution before they can call an accelerated payment
- The best options are: work with your current lender, refinance or sell your house.
Understanding the Timeframe:
Typically, lenders notify you of a late mortgage payment a few days after the due date. When your loan is 30 days overdue, a notice of default is often sent. In Texas, upon receiving a notice of default, you have 20 days to bring your balance current. After this period, your lender may accelerate the loan, requiring the entire balance to be paid within an additional 21 days. In total, you have 41 days to solve the problem before your property goes to auction. Keep in mind that specific lender practices and timelines may vary, but these are the minimum requirements in Texas.
Texas Mortgage Relief Programs:
Regrettably, Texas currently lacks programs dedicated to assisting homeowners with mortgage payments or providing mortgage relief. The Texas Home Owner Assistance Fund Program (TXHAF) was a temporary initiative addressing COVID-19’s impact, offering up to $25,000 per eligible household. However, it’s no longer accepting new applications.
Collaborate with Your Lender:
Initiate a conversation with your lender to discuss your situation and explore potential options. If your financial strain is temporary, they might consider a loan forbearance or modification to delay or defer payments, providing you the time needed to catch up. Seeking guidance from HUD counseling agencies can also be beneficial in navigating the process.
Refinancing Your Property:
For those who have owned their property for several years, refinancing could be a viable option. As you’ve made mortgage payments, you’ve gradually reduced your debt, and property values typically appreciate over time. These factors may make refinancing attractive to a new lender and may reduce the size of your monthly payment. However, it’s crucial to act early as late payments will impact your credit score and a new lender will be less likely to work with you if your credit score is showing missing payments.
Selling Your Property:
Selling your property can settle the debt and potentially put a substantial amount of cash in your pocket. Choosing the right buyer is critical, particularly one who can meet your time requirements and purchase the house in as-is condition. Cash buyers like J&A Home Buyers can close in as little as 7 days, providing a quick resolution. Additionally, creative strategies, such as a lease-back program, may allow you to stay in the property even after the sale.
What’s the Next Step?
Talk to a real estate professional to explore options! There are many ways to structure deals or help homeowners in Texas. We are home buyers but we also have several licensed realtors on our team so we have worked through hundreds of transactions with homeowners just like you. It doesn’t mean we buy every house but we do our very best to help those who reach out find a solution that fits their situation. Fill out the form on our website for one of our team to reach out.