How does the lender recover legal fees and costs in a foreclosure?

In Texas, a lender is allowed to recover legal fees and costs associated with a foreclosure in two ways. Firstly, the lender may include the costs in the amount the borrower must pay to cure the default. This is usually the case when the borrower has defaulted on some payments and is seeking to reinstate the loan. The costs are usually spelled out in the loan documents. Secondly, the lender may request the court to award them the costs through a process known as a “motion for recovery of attorney fees and costs”. In this case, the court evaluates the amount of fees and costs the lender incurred to determine whether they should be awarded as part of the judgement. The court reviews the costs in order to ensure that they were reasonable and necessary for the successful completion of the foreclosure. In either of the two scenarios, the lender is responsible for proving the amount and reasonableness of the fees and costs to the court to ensure that the costs are awarded. Once awarded, the court will include the fees and costs in the judgment to be paid by the borrower. Failure to pay the fees and costs may result in additional legal action taken by the lender.

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How does the lender recover legal fees and costs in a foreclosure?

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