If you are facing a foreclosure you need a Houston Consumer Bankruptcy lawyer who has successfully handled thousands of foreclosure issues. This is no time to choose an attorney who occasionally dabbles with Bankruptcy cases and doesn't understand foreclosure on deeds of trusts, mortgages in default, non-judicial foreclosure, judicial foreclosure and Chapter 13 or Chapter 7 bankruptcy. You need a Houston lawyer who knows how to STOP foreclosures immediately.  You need an attorney who knows how to communicate with your mortgage company and who knows how to decipher the codes and languages they use to determine how much you really owe.  You need Vicky Fealy and her team at The Fealy Law Firm, PC. Vicky Fealy is one of a limited number of Texas Board Certified Consumer Bankruptcy attorneys in Houston. She has over twenty years of experience in stopping foreclosures.  She has spoken at conferences and been interviewed by the press regarding mortgage servicing issues.

What is Foreclosure?

Foreclosure is the legal proceeding in which a bank or other secured creditor sells or repossesses a parcel of real property (immovable property) due to the owner's failure to comply with an agreement between the lender and borrower called a "mortgage" or "deed of trust". Commonly, the violation of the mortgage is a default in payment of a promissory note, secured by a lien on the property. When the process is complete, it is typically said that "the lender has foreclosed its mortgage or lien".  This means the original homeowner no longer owns the home and must move out.

Texas Foreclosure

In Texas, lenders may foreclose on deeds of trusts or mortgages in default using either a judicial or non-judicial foreclosure process. How long the process takes and the steps involved, depend on which type of foreclosure is pursued.  Mortgage companies and banks (first and second liens), property tax authorities and homeowner associations can foreclose on homesteads in Texas.  If the property in question is not a homestead, it is possible that a judgment creditor could foreclose if the property is not exempt.

Judicial Foreclosure

The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, the property will be auctioned off to the highest bidder following the same process from this point on as the non-judicial foreclosure.  Judicial foreclosure is most often used in Texas for mortgages involving Home Equity loans, Homeowner Associations and delinquent property taxes.   While it may take longer for a foreclosure to proceed this way, often there are higher fees due to increased attorney fees and costs of Court.

Non-Judicial Foreclosure

The non-judicial process of foreclosure is more commonly used in Texas and is usually a quicker process.  It is used when a power of sale clause exists in a mortgage or deed of trust. A "power of sale" clause is the clause in a deed of trust or mortgage, in which the borrower pre-authorizes the sale of property to pay off the balance on a loan in the event of default. In deeds of trust or mortgages where a power of sale exists, the power given to the lender to sell the property may be executed by the lender or their representative, typically referred to as the trustee or substitute trustee.

Under the non-judicial process of foreclosure, a lawsuit does not need to be filed as a court order does not need to be obtained to proceed with foreclosure.  Thus, a non-judicial foreclosure can occur fairly rapidly.  If you are receiving letters threatening foreclosure, it is wise to seek legal counsel immediately.

A foreclosure sale is posted and held on the first Tuesday of each month in Texas, generally at the courthouse in your county.  The home posted for foreclosure will be auctioned off to the highest bidder.  Once a home has been foreclosed, it is extremely difficult and quite costly to attempt to overturn the foreclosure. The only ways to stop a foreclosure are full payment of the arrearage, a temporary injunction or the filing of a Chapter 13 bankruptcy. This process stops the foreclosure and allows you to repay your arrearage over a three-to-five year period. The arrearage and your regular monthly payments are paid through a court-appointed official in order to keep your home. A Chapter 13 can be filed at any time prior to the sale date to save your home.  An automatic stay goes into place immediately upon the filing of a Chapter 13, thus stopping the foreclosure and giving you an opportunity to present a plan of repayment.