Brownsville residents who get behind on their mortgage loan payments could face legal ramifications from their lenders. Upon purchasing a home, it becomes collateral for the loan, which means that failing to make the agreed-upon payments could mean the lender will initiate foreclosure proceedings. During this process, the lender attempts to take possession of the loan's collateral -- the home.
Seizing the property is the short version of what a foreclosure entails. In reality, the lender must go through a legal process. Most foreclosures go through the "judicial foreclosure" process in which the lender files a lawsuit against the homeowner, demanding payment of the remaining balance of the loan or surrender of the home. If the borrower fails to pay within the prescribed amount of time and the court rules in favor of the lender, the home could be sold at auction. Texas law allows for both judicial and nonjudicial foreclosures.
Even though the lender who extended credit to a Brownsville homeowner would rather have the money owed than the property itself, it does not stop the lender from proceeding when necessary. For this reason, the lender may begin making phone calls regarding payment after the second missed payment, and by the third will probably send a letter demanding payment within 30 days. Most mortgage loan companies do not take this step until a homeowner misses at least four payments, but may do so prior to it reaching this point.
Homeowners do not have to simply sit back and wait for their lenders to begin foreclosure proceedings. There may be options to avoid this process, ranging from forbearance to filing for bankruptcy and everything in between. Those who find themselves facing foreclosure may want to try to get ahead of the situation by consulting with an attorney as soon as possible.