What is the Eviction Process in Texas After Foreclosure?
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You are obligated to make your mortgage and property tax payments on time when you buy a home. However, financially devastating events due to divorce, the loss of a job, or costly medical bills can make keeping up with your home payments difficult or impossible, leading to foreclosure. In these cases, the bank (or the government in a tax foreclosure) has the right to seize your home as compensation for the money you are not paying them. After that, they will usually require you to leave the property
As soon as the foreclosure process begins, time is of the essence if you want to avoid eviction. Here’s what you need to know about the post-foreclosure eviction process in Texas.
Key points from this article:
- Foreclosure Outcomes – There are three possible outcomes after a foreclosure sale: the property is not sold, the bank buys back the property, or a third party buys the property. Each outcome has different implications for the previous homeowner's ability to reclaim the property.
- Eviction Process – If a homeowner refuses to leave after foreclosure, they can be legally evicted by the new property owner. The eviction process in Texas includes a notice to vacate, court date, judgment, appeal or vacation, final eviction notice, and removal.
- Fighting Eviction – Homeowners can fight eviction by appealing the court's decision within five days of the hearing. They may also have the option of statutory redemption, which allows them to buy back their home within two years after a tax lien foreclosure.
- Cash for Keys – In some cases, the new property owner may offer the previous homeowner a cash settlement in exchange for the keys to the house, preventing the need for eviction. This can be a beneficial option for the previous homeowner, but it is important to thoroughly review the terms and conditions before agreeing to a cash for keys arrangement.
Disclaimer – The information on this page is intended for general informational purposes only and not to provide legal advice.
My home has officially been foreclosed—what now?
Once the pre-foreclosure period for a home has ended and the day of the foreclosure sale arrives, there are three possible outcomes. Which of the following events takes place determines what happens to the property:
The property is not sold:
In some cases, issues arise during the sale process that lead the party responsible for the sale to decide that the home should not be sold just yet. If this happens with your home, you’re in luck—you have a little more time to try to get your property back if you want it. You can use the time between now and the next month’s sale to communicate with your lawyer about the best steps to take to reclaim your home.
The bank buys back the property:
The bank sets a minimum bid when a property goes up for auction. If no buyers are willing to pay that amount, the home is sold back to the bank. Even though the house no longer belongs to you, there will likely be nobody living in it for a while, so you may still have a chance of getting it back if your attorney manages to negotiate a deal with the bank.
A third party buys the property:
When a party other than the bank buys a property, they will probably want possession of the home as soon as possible, so the eviction process can begin as early as the day of the sale.
What happens if you refuse to leave after a foreclosure?
If you remain on a property after it has been foreclosed, you are legally regarded as an “unlawful detainer,” and the property’s new owner has the right to pursue legal action to get you to leave. As early as the day of the foreclosure sale, the new owner may commence the eviction process.
What are the steps in the eviction process?
If you are still living on a property after it has been sold, the new owner has the right to evict you. The eviction process in Texas consists of the following steps:
Notice to Vacate:
The new property owner gives the previous owner a notice stating that they have 3 days to leave the property.
Court Date Is Set:
If the previous owner has not left after the 3 day period has ended, the county constable provides a date for them to appear in court. The documents detailing this information, which must be delivered at least 6 days before the trial, are usually handed directly to someone in the house. If no one is home, it can be left in the mailbox, slipped under the door, or taped to the outside of the door.
On the day of the hearing, the judge issues a ruling. After this ruling, no further action can take place for the next 5 days. This gives both parties some time to appeal the decision if they choose.
Final Eviction Notice:
If the previous homeowner is still on the property after 5 days have passed, they will be provided with 24 hours’ notice to vacate the property.
If the previous homeowner has still not left the property after 24 hours, the constable will come to forcibly remove any occupants and their belongings from the property.
How long is the Texas post-foreclosure eviction process from start to finish?
Overall, the post-foreclosure eviction process described above is quite fast. It is not uncommon for the process to be completed in 60 days or less after the initial notice to vacate. This leaves the homeowner with very little time to get their affairs in order, so it is crucial to be on top of every step of the process to avoid missing any important deadlines.
Can you fight an eviction after foreclosure?
If the court rules against you in a foreclosure eviction case and you feel that the decision was unfair, you can appeal for a new trial with a different judge. While an appeal may be able to save you from eviction, you only have a very brief window of opportunity to make the necessary arrangements—all paperwork and applicable payments must be submitted no more than 5 days after the initial hearing.
If you are unable to fight your eviction through the appeal process successfully, you may still have another option in the form of statutory redemption if the foreclosure was the result of a tax lien.
What is statutory redemption?
In some cases, like a tax lien foreclosure, the homeowner may be able to regain their property through a process called statutory redemption. Statutory redemption provides you with a period of 2 years to buy your home back, during which you will typically be allowed to remain on the property.
If the home has been sold to a new owner or the bank, you'll need to pay the final bidding price the home was bought for, plus interest, taxes, penalties, and any additional costs the current owner had to pay for the property. Note that the interest you will need to pay increases over time, with a redemption premium of 25% during the first year of the redemption period and 50% during the second year.
If no one has bought the home and it is currently the county's property, the county will decide on a fair market value that you need to pay in addition to the deed filing fee and any other applicable legal costs.
What is cash for keys?
Evictions can cost a significant amount of time, effort, and money. As such, when a third party or bank buys a foreclosure home, they may wish to pursue other options to convince the previous residents to vacate the property.
As the name implies, cash for keys is an arrangement in which the home’s new owner offers the previous owner a set amount of money in return for the keys to the house. This is a win-win situation that prevents either party from dealing with the hassle of the foreclosure process.
Cash for keys is usually a good deal for the previous homeowner, as it both prevents an eviction from going on their record and provides them with cash to put towards a new home. However, it is important to thoroughly research the terms and conditions of a cash for keys agreement before deciding for certain that it is worth signing.
What if a tenant is living in a home owned by a landlord that was foreclosed on?
After a landlord is foreclosed on, renters are guaranteed certain rights by the Protecting Tenants at Foreclosure Act. If a renter is legally recognized as a “bona fide tenant” (i.e., not the landlord or a member of the landlord’s family), they are entitled to stay on the property for the remainder of their lease as long as the new owner does not intend to move in.
If the new owner does wish to live on the property, they must provide any tenants with at least 90 days’ notice before terminating the lease. If a tenant does not leave the property after the lease has been terminated, the owner has the right to evict them.
While fighting eviction after foreclosure is difficult and not always worthwhile, it is possible in some cases. Before giving up on your home, be sure to explore all the different options available to you. With some hard work and good luck, you might just be able to reclaim your property.