Everyone in real estate market is looking for a good deal. None of my clients call me and say," Hey Sylvia, I would like to buy an over-priced house." Everyone says, "if its a good deal I would buy it."
Foreclosure properties form a majority part of good deals available in the market. But majority of buyers are indecisive about purchasing a foreclosure for number for number of reasons. It could be the lengthy process of purchase, the "Sold as is where is" Clause or the fact that at the court anyone could bid higher and get the property.
Therefore in this blog I am going to explan the buying process of foreclosures.
When someone defaults their mortgage, the bank requests the owners to pay back the entire amount of the mortgage or pay off the amount that is outstanding plus interest. The sellers are given 3-6 months as redemption period to come up with the funds and pay off the bank. After the redemption period if the sellers are unsuccessful in paying the money to the bank or any other mortgagee, then a petition is filed in the court by the bank or mortgagee.
Upon approval by the court the house is listed in the market for sale. The first buyer gets to write up an offer with conditions or subjects (e.g. Subject to financing, Title search, inspection etc.). Once the conditions are removed by the buyer the offer gets registered at the court and a court date is set. Once the offer is registered at the court and court date is assigned the Listing Realtor is allowed to disclose the price of the accepted offer to other parties inquiring about the property.
On the court date, the Lawyer or the Listing realtor asks if there are any other people interested in submitting an offer. The other interested buyers have to give their offers in a sealed envelope to the lawyer and they cannot have any conditions or subjects on their contract. Since the bidding parties cannot have any conditions on their offer, therefore it’s crucial that they have themselves pre-approved or have required funds available before the court date. Then the first and original buyer is given the opportunity to increase his/her purchase price if he or she wishes to.
All the offers are giving to the judge in sealed envelope. The judge gives the property to the parties who have the highest offer on the property. I have been lot of foreclosures and court dates; also have won lot of them for my clients. Usually people assume that the Judge has an open auction in the court room and the property goes to the highest bidder. THAT DOES NOT HAPPEN.
Everyone just gets one shot in the court to buy the property. Once all the offers are handed to the lawyer before the court proceedings, no changes or price increases could be made after that.It all sounds complicated and lots of hassle but it is a pretty simple process and I have fair knowledge of how to deal with foreclosures. So you just select the property you are interested in and leave the rest to me.
Currently there are numerous foreclosures available in the market. I have upload a few on my website. If you require any further information on any of them please let me know.