With foreclosures in the Dallas area on the rise, we are hearing more and more questions about the rights that homeowners have during the foreclosure process. Foreclosure is obviously a challenging and confusing time, and understanding your rights is crucial for navigating the process effectively. Since we know more people are searching for these answers, I wanted to outline the key rights you have as a homeowner in Texas during foreclosure.
Right to Notice
Notice Before Acceleration: In Texas, before your lender can accelerate your loan (demand the full balance), they must provide you with a notice that gives you at least 20 days to “cure the default” (the official term for paying off the overdue amount and late fees).
Notice of Sale: After the loan is accelerated, the lender must give you at least 21 days’ notice of the foreclosure sale. This notice must be sent by certified mail and must detail the date, time, and place of the sale.
Right to Cure the Default
Even after the foreclosure process begins, you maintain the right to stop the process by “curing” the default. This means you can pay the overdue amounts, including any additional legal fees or costs incurred by the lender due to the foreclosure process, up to a certain point before the sale.
Right to Redeem the Property
In Texas, for non-agricultural properties, there is no post-sale statutory right of redemption. This means you cannot reclaim your property after the foreclosure sale by paying off the debt. However, in specific scenarios, such as tax foreclosure, a redemption period may apply. It’s essential to understand the specific circumstances of your case.
Right to Challenge the Foreclosure
You have the right to challenge the foreclosure in court if you believe the process was conducted improperly or if there are issues with the mortgage itself. This might include situations where the lender did not follow proper procedures or if there are questions about the loan’s validity.
Right to a Deficiency Judgment
In Texas, if your foreclosed property is sold for less than the amount you owe, the lender might obtain a deficiency judgment against you for the difference. However, you have the right to challenge the amount of the deficiency, especially if the sale price was unfairly low.
Right to Bankruptcy Protections
Filing for bankruptcy can temporarily halt the foreclosure process. Under a Chapter 13 bankruptcy, you may be able to reorganize your debts and develop a plan to catch up on missed mortgage payments. Meanwhile, Chapter 7 might offer a temporary reprieve, but it is less likely to allow you to keep your home in the long run.
Right to Access Surplus Funds
If the sale of your property generates more money than what is owed, you have the right to any surplus funds. After the mortgage and other foreclosure costs are paid, any remaining amount should be returned to you, the former homeowner.
Right to Seek Legal Advice
One of the most critical rights you have is the right to seek legal advice. An experienced attorney can help you understand your rights, navigate the foreclosure process, and explore options like loan modification, short sale, or deed in lieu of foreclosure.
Protect Your Rights with Expert Legal Guidance
Foreclosure can be a daunting process, but you are not alone. As a homeowner in Texas, you have specific rights that can help you navigate this challenging time. Understanding these rights is crucial to making informed decisions about your property and financial future.
If you are facing foreclosure, it is essential to seek expert legal guidance. As an experience bankruptcy attorney in Dallas, Texas, I specialize in helping clients understand their options and rights during the foreclosure process. Call 214-760-7777 to schedule a free consultation, where we can discuss your situation, explore your legal options, and develop a strategy tailored to your unique circumstances.
Remember, the sooner you seek legal advice, the more options you may have. Contact our office today to schedule your free consultation and take the first step in protecting your property and financial future.