Foreclosure Law in Texas

In Hidalgo, Texas is a process allowing a lender of a mortgage to take possession or ownership of the property that secured the mortgage in the first place, to cut their losses when a borrower defaults on his or her loan.

When consumers have to deal with foreclosure, it almost always involves a home. The bank will typically take possession of the house, and then sell it at auction, to try to cover the balance of the mortgage. Banks usually want sell the property quickly, for as much money as possible.

In every U.S. state, including Texas, a borrower has a right to a judicial sale of their foreclosed property. A judicial sale is simply an auction overseen by a court. The purpose of this is to make sure that the lender takes reasonable steps to sell the home for the highest possible price, and to ensure that the homeowner has an opportunity to bid on the house, if he or she is able. It is in everybody's interest for the bank to get the highest price possible for the house, even the borrower's. If the house fetches a higher price than what's left on the mortgage, the buyer can keep what's leftover. On the other hand, if it fetches less, the buyer might have to pay the deficiency.

In some states, original mortgages are known as "non-recourse" loans, making the above problem a non-issue. This basically means that once the mortgaged property is sold by the lender, the debt is discharged, even if the sale nets less than the remaining balance on the mortgage. The borrower will simply have to write this off as a loss. However, this usually does not apply to refinanced or second mortgages.

How to Possibly Avoid Foreclosure in Hidalgo, Texas

First and foremost, you need to communicate with your lender, and not ignore the issue. Ignoring a problem with your mortgage will not make it go away, and can only make things worse. You should be honest with your lender, and stay in touch with them as much as possible.

Bear in mind that banks aren't in the business of real estate speculation - they're in the business of lending money, and making profits through interest on their loans. In short, the bank doesn't really want your house - they'd much rather have you continue making your mortgage payments. For banks, foreclosing on a home is a last resort. Basically, nobody likes foreclosures, and everyone wants to avoid them.

Because banks don't particularly enjoy foreclosing, they will probably be willing to work out an alternative payment plan with you, if necessary. However, if you think that this might be needed in the near future, you should contact your lender immediately. The sooner they know about it, the more options you have.

As a last resort, you might consider a "short sale," which results in loss of the home, but it usually leads to a great deal of the debt on the mortgage being forgiven. Essentially, a short sale in Texas involves selling the house for whatever price it can fetch. The proceeds from the sale go to the lender, and if it sells for less than what's left on the mortgage, the balance of the debt is forgiven.

Can a Hidalgo, Texas real estate attorney help?

If you feel that your home is close to being foreclosed in Hidalgo, Texas, and want to try to prevent this, the advice and assistance of an experienced real estate lawyer can mean the difference between keeping or losing your home.