Since 2008, thousands of families have filed to foreclose on their homes. Lost jobs, medical expenses or child costs create risky scenarios and leave individuals unable to make mortgage payments. As bills go unpaid, banks begin the process of a foreclosure sale on your home.

If you receive a foreclosure notice, you may wish to identify your assets and determine whether you can pay your owed fees. Throughout this emotional and financially uncertain time, it proves essential to understand the basic principles behind a foreclosure.

Knowing the elements of a foreclosure procedure

Although banks repossess 1 in every 2,013 homes in Texas, many individuals experiencing foreclosure may not understand the steps a lender must take to obtain the home as payment. Steps to a foreclosure sale occur as follows.

1. Notice of Default: When homeowners prove unable to pay their mortgage from 30-45 days, their lending bank may issue a Notice of Default. You should receive the letter in the mail, and the bank may set a specified time that you must pay the missing mortgage payment.

A study conducted by the Texas Department of Housing and Community Affairs (TDHCA) reports that the process from delinquency to foreclosure sale potentially takes only 41 days. You, as the borrower, have very little time to arrange specific details regarding losses until the foreclosure process closes, so you may wish to act quickly.

2. Filing foreclosure: If you prove unable to repay the bank in the allotted time, bank representatives may proceed in filing foreclosure on your home. Two types of foreclosures in Texas include:

Non-judicial: Used when a “power of sale” clause, a clause that states the pre-authorization of the sale of your home can be used to pay off the loan to the bank, is listed in the mortgage

Judicial: Used to file a lawsuit to obtain a court order to foreclose; used when no power of sale clause is listed

  1. Notice of Foreclosure Sale: If you still prove unable to pay after filing, you may receive a Notice of Foreclosure Sale that states when you must vacate your home.
  2. Sale of your home: In many instances, your home may be sold in a public auction, where the highest bidder may purchase the property.

The right action to take when you receive a Notice of Default includes preparing for possible foreclosure. Although the process may be stressful and confusing, understanding that many families go through similar heartaches may leave you content in knowing you are not alone.