Despite the influx of media attention that has recently been paid to foreclosures around the nation, Houston foreclosures occurred even during economically fruitful times. In fact, what makes the recent flurry of attention especially thought provoking is that there is a lack of credible statistics available concerning the increase in foreclosure rates in Houston. The same applies to the Sugar Land real estate market, which has historically been a relatively tight niche and constantly growing market.
Although the specific legal technicalities that arise vary from jurisdiction to jurisdiction, foreclosure is a relatively predictable legal process. In its simplest manifestation, a foreclosure involves the termination of the homeowner’s interest in the property. Foreclosures typically arise when the homeowner has defaulted on his or her payments owed to the financial institution or lender. While many complications can and often do arise, a financial institution may attempt to reposes the property upon the homeowners default on the mortgage payments. When a homeowner owes money to several financial institutions, all of which have liens on the property, repossession can become far more complex.
In many cases, when the financial institution regains the property, it often moves to sell it in order to pay off the lien and any legal costs and fees associated with the foreclosure action. Given the many intricacies involved, it is often necessary to contact a Houston real estate expert such as an attorney in order to help navigate through the process and to obtain legal advice.
A short sale arises in the context of residential property that has gone into default, typically by the homeowner’s inability to pay the mortgage. In most instances, the borrower negotiates with the financial institution to agree to sell the residential property for a price that is less than the amount owed to the financial institution. Although a short sale results in a monetary loss to the financial institution, it is advisable in many instances. A short sale allows the bank (and the borrower) to avoid having to go through foreclosure proceedings. Foreclosure proceedings are not only costly to the financial institution, but also have a devastating impact on the borrower’s credit score.
Depending upon the arrangement between the homeowner and financial institution, the borrower may continue to be liable for the remaining amount owed to the bank under the loan, despite the short sale. It is always advisable to contact a local Houston real estate attorney in order to receive legal advice.