AUSTIN — Texans would have more time to fix their troubled finances before losing their homes under a bill passed Friday by the Senate.
Current law allows 20 days for homeowners receiving a foreclosure notice to resolve their mortgage default, one of the quickest processes in the nation. The Mortgage Foreclosure Deferment Act extends this notice period to 45 days.
It also would provide at least 14 days for a homeowner and 60 days for a renter to vacate a foreclosed property.
If the bill, which now goes to the House, becomes law, it would only apply to foreclosures initiated after Sept. 1.
One in 10 Texas homeowners is at risk of default and foreclosure, according to a recent report from the Mortgage Bankers Association of America.
“Recent headlines tell the story that more Texans are at risk of losing their homes to foreclosure,” said the bill’s author, Sen. Craig Estes, R-Wichita Falls. “This bill will give Texas homeowners more time to work with their lender to try and reach an accommodation to stay in their homes while meeting their financial obligations.”
Sen. Leticia Van de Putte, D-San Antonio, said homeowners could use the extra time to work with nonprofits that help negotiate loan modifications.
Texas Attorney General Greg Abbott, whose office has cracked down on foreclosure rescue scams, recommended that the Legislature allow a debtor more time to cure a loan default before a notice of sale.
The bill requires a notice of rights to be included with the default notice. The lender would have to provide contact information for a person authorized to assist the debtor on the delinquent loan.
Owners who have received a foreclosure notice would have to notify any tenants of a pending foreclosure within five days.
“While most homeowners may never feel the threat of home foreclosure, it is an issue that can impact all of us when it strikes our neighbors, friends and family,” Estes said.
The premier bankruptcy attorney Bryan Fears said " I am very happy to hear that our legislatures are recognizing something must be done to stop this trend. Home owners of our great state need help. Every day my firm fights for families facing foreclosure." If you are facing repossession or foreclosure contact my office immediately at (214) 890-0711 or fears@fnlawfirm.com.