How to Avoid Foreclosure in Texas: Your Options (Austin, Waco, Temple Area)

If you're behind on mortgage payments and facing foreclosure in Central Texas, you're not alone - and you still have options. Whether you're in Austin, Waco, Temple, Killeen, or a surrounding area, here's what you need to know about avoiding foreclosure and protecting your credit.

The Texas Foreclosure Timeline

Texas is a "non-judicial foreclosure" state, meaning lenders don't need to go to court. The process moves fast:

• Day 1: You miss a payment

• Day 30-60: You're officially delinquent

• Day 90: Lender sends "Notice of Default"

• Day 120: Lender posts "Notice of Sale" (21 days before auction)

• Day 141: Your home can be auctioned on the courthouse steps

You have roughly 4 months from your first missed payment to foreclosure sale. Once your home is auctioned, it's too late.

Your Options to Avoid Foreclosure

Option 1: Loan Modification Contact your lender immediately and ask about:

• Payment reduction programs

• Interest rate reduction

• Extension of loan term

• Forbearance (temporary payment suspension)

This works if you've had a temporary setback but can now afford modified payments. It does NOT work if you fundamentally can't afford the house.

Option 2: Refinance If you have equity and decent credit, refinancing to a lower rate might make payments affordable. However, most people facing foreclosure don't qualify because they're already behind.

Option 3: Deed in Lieu of Foreclosure You voluntarily give the house back to the bank. This damages your credit less than foreclosure but you walk away with nothing. Only consider this if you have no equity.

Option 4: Bankruptcy Filing Chapter 13 bankruptcy triggers an "automatic stay" that stops foreclosure temporarily. This buys time but doesn't solve the underlying problem - you still owe the debt. Consult a bankruptcy attorney.

Option 5: Sell Your House Before Foreclosure If you have ANY equity, selling before foreclosure is almost always your best option. Here's why:

Foreclosure Consequences:

• Credit score drops 200-300 points

• Foreclosure stays on credit report for 7 years

• Difficulty getting future mortgages, car loans, even apartments

• May still owe money if house sells for less than mortgage (deficiency judgment)

• Emotional trauma of being forced out

Selling Before Foreclosure:

• Protects your credit (shows as normal sale)

• You might walk away with cash if you have equity

• You control the timeline and keep your dignity

• Clean financial break - no deficiency judgment

Why a Cash Sale Makes Sense When Facing Foreclosure

You don't have time for a 3-month traditional listing. Cash buyers can:

• Close in 7-14 days (before foreclosure auction)

• Buy even if you're behind on payments

• Pay off your mortgage and save your credit

• Give you any remaining equity to start fresh

What If You Owe More Than It's Worth?

If your home is "underwater" (you owe more than it's worth), you'll need a "short sale" - where the lender agrees to accept less than you owe. This requires:

• Proof of financial hardship

• Lender approval (takes 2-4 months typically)

• Buyer willing to wait for approval

Some cash buyers specialize in short sales and can negotiate with your lender on your behalf.

How Much Time Do You Have?

If you just missed 1-2 payments: Call your lender immediately. You can likely get caught up or get forbearance.

If you've missed 3-4 payments: You're in the danger zone. Start exploring selling options NOW.

If you received Notice of Sale: You have about 21 days. Contact a cash buyer immediately - this is your last chance.

What to Do Right Now

1. Don't ignore it - Hope is not a strategy

2. Call your lender - Ask about loss mitigation options

3. Talk to a HUD-approved housing counselor (free service)

4. Get a cash offer - Know your options before it's too late

5. Consult an attorney if needed

We've Helped Hundreds Stop Foreclosure

We've worked with many Central Texas homeowners facing foreclosure. Our cash offers have helped people avoid foreclosure, save their credit, and walk away with money to start fresh. We close fast - usually in 7-14 days - even if you're days away from auction.

Serving All Central Texas

Austin, Round Rock, Georgetown, Cedar Park, Waco, Temple, Belton, Killeen, Harker Heights, and all surrounding communities.

Clear Path Closing - Licensed Texas Real Estate Professionals.