If you are behind on your mortgage payments, you may be wondering how long you have until the bank files a notice of foreclosure on your home. In many mortgage agreements, as soon as you miss one payment, the lender has the right to initiate the foreclosure process. Fortunately, most lenders wait until the mortgage is 90 days delinquent before they start. (In rare cases, some lenders will wait more than a year before filing a notice of foreclosure, but generally, 90 days is the norm.)
Prior to initiating the process, the bank will send one or more reminders to pay your mortgage. If you do not catch up on your payments, ultimately, the bank will send a demand letter. This letter will state the amount you need to pay and the deadline that the payment is due before the lender begins the foreclosure process. The amount you owe is usually the past due mortgage, plus any penalties. This demand letter represents your second-to-last chance to get back in good standing with the bank.
If you do not make the payment by the deadline in the demand letter, you likely will receive two more letters from an attorney. The first letter will state that the attorney is acting as a debt collector on behalf of the lender and will initiate foreclosure on your home if you do not pay the amount due. (Depending on your bank’s policies, you may not receive this first letter.) The second letter is the actual foreclosure notice, which comes as a certified letter from the attorney’s office. It will state that the house is being put up for a Sheriff’s Sale (i.e., a foreclosure auction) and give the date.
In Texas, foreclosure auctions are always held on the first Tuesday of the month. The lender must file the notice of foreclosure for mortgages that are in default at least 21 days prior to the next foreclosure date. For example, the next foreclosure date is February 7, 2012, so all filings for foreclosures must be filed by January 17, 2012. This means that on or about January 17th, attorneys statewide will be sending out notices of foreclosure on behalf of the banks they represent. Assuming the mail takes two days to arrive, a homeowner may receive the notice as little as 19 days prior to the foreclosure date.
The notice of foreclosure will arrive via certified mail and presents the very last opportunity to try and negotiate with the bank. If you receive a notice of foreclosure, we recommend that you call us immediately, so we can take steps to stop the foreclosure and do a short sale. If you do not take action, the house will go to foreclosure. The bank will contact you — either by mail, phone, or sending a representative in person — a few days after the Sheriff’s Sale to make arrangements for you to move out. There is no turning back at this point. If you do not vacate the house by the move out date, the bank can start eviction proceedings, which will ultimately result in the Constable showing up at your door to put your belongings in the front yard and change the locks.
If you are behind on your mortgage and know that you can no longer afford the monthly payments, do not wait until the bank sends a demand letter or notice of foreclosure before you begin to take action. The later you act, the lower the chance of a successful short sale. Call our office, and we can help you arrange a short sale for your home, so you have time to find a more affordable residence. Even if you have received a notice that your home will be included in the next Sheriff’s Sale, call us immediately. We may still be able to negotiate a short sale with the bank and help you avoid foreclosure.