Foreclosure is a judicial process in which a mortgage lender recoups some of its losses in the event of default by taking possession and/or ownership of the home that secured the loan in the first place in New Braunfels, Texas When a house is foreclosed, it is usually sold at auction shortly thereafter. This is because banks usually want to get rid of the property as soon as possible, even if it means losing some money, and an auction is an easy way to do this.

In all states in the U.S., including Texas, there is an option to go through foreclosure via judicial sale, in which a court oversees the sale, and makes sure that the proceeds first go to the lender, and then to any other entities that might have a lien or other interest in the property (in order of priority), and, finally, to the borrower, if anything is left. In many states, original mortgages are considered non-recourse loans, meaning that if the house is foreclosed and sold for less than the debtor owes, the bank cannot go after the debtor for the remainder. You should consult with an attorney in New Braunfels, Texas to see if this is the case. However, this usually doesn't apply if the mortgage has been refinanced.

How Can I Avoid Foreclosure in Texas?

First of all, you shouldn't ignore the problem. You should stay in contact with your bank, and be honest with them. Ignoring the issue will not make it go away. It is essential to remember that banks don't really want to own homes in New Braunfels. In issuing a mortgage, they expect to make a profit through interest on the loan, and they'd prefer to continue collecting from you. Therefore, they're likely to make reasonable accommodations to your financial situation if it will enable you to keep paying them in the long run.

If no deal can be worked out, or the mortgage payments have become prohibitive, you might consider a "short sale". While the lender has to consent to it, many will take a moderate loss if it means avoiding foreclosure (which lenders generally treat as a last resort). This allows you to sell the house for whatever price it can fetch on the current market, and hand the proceeds over to the bank. If the sale nets less than the balance, some or all of the deficiency might be forgiven. You could also consider a "short refinance" which allows a chunk of the debt to be forgiven, and lets you refinance the rest.

How Can A New Braunfels, Texas Attorney Help?

If you are worried about foreclosure, a good New Braunfels, Texas real estate lawyer might be able to help. A lawyer can increase your chances of keeping your home, and help minimize the financial impact if keeping it proves impossible.