Texas foreclosures are done through both judicial and power of sale process. As, in Texas Title theory is the standing law, title of the property remains under the control of trust until the final payment is not done on the home equity loan. The whole process is carried through a deed of trust or mortgage. When the borrower (homeowner) breaches the deed of trust, the lenders are empowered to file foreclosure. In this article we will discuss on foreclosure processes prevailing in Texas, their dynamics and advantages of buying bankruptcy homes in Texas.
Foreclosure without (or limited) intervention of the court of law is the most popular type in Texas. This process is also known as power of sale foreclosure and offers better scope for the borrower to safe guard his/her interest. In Texas, all the lenders of home equity loans sign the power of sale document prior to the approval of loans. This document is a legal binding tool to sale the property by the trustee when there is default in payment of loan amount and interest. It is sold through the process of auction and the owner receives notice some days prior to it.
However, selling bankruptcy homes in Texas through power of sale follows more stringent procedure compared to judicial foreclosure. Before going for foreclosure, the lender has to convey a demand letter regarding the full and final payment of dues on the borrowed amount to the borrower. The demand letter gives 20 days grace period to the borrower for payment. When the borrower fails to fulfill the demand, the process of foreclosure is initiated. There is another 21 days gap between the end of grace period and the foreclosure sale. During this period, the county clerk signs on the foreclosure plea and sends to the borrower. As a standing rule, foreclosure sales occur on the first Tuesday of every month.
Texas Foreclosures offer a unique opportunity to the prospective homeowners and real estate investors to purchase property at a lower rate. Bankruptcy homes cost up to 36% lower compared to fresh properties. Instant possession on the properties is possible as they lay unoccupied. In most of the cases, these homes require little renovation. All relevant information related to the availability and purchase of these properties can be availed from local newspaper ads and real estate websites.
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