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How to Buy a Foreclosure
 

How to Buy a Foreclosure

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This presentation gives first-time homebuyers tips on how to buy foreclosures. We provide an explanation of foreclosure laws, a timeline of the foreclosure process and a guide to different ...

This presentation gives first-time homebuyers tips on how to buy foreclosures. We provide an explanation of foreclosure laws, a timeline of the foreclosure process and a guide to different foreclosures. Visit ForeclosureDeals.com to learn more about how to buy a foreclosure.

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    How to Buy a Foreclosure How to Buy a Foreclosure Presentation Transcript

    • How to Buy a Foreclosure The beginners guide to foreclosure home buying
    • Basic Tips for First-Time Homebuyers Try to get pre-qualified for a home loan. If your credit score is below 700, seek a credit repair service. If you have time, hire a contractor and appraiser to inspect the home. Run a title search on the property. If you are unsure of your ability to purchase a home on your own, hire a real estate agent.
    • Is Your State Judicial or Non-Judicial?In a Judicial Foreclosure state: The lender sues the homeowner in order to foreclose on the house. Homebuyers in these states may have to prove their ability to pay for the home in court.In a Non-Judicial Foreclosure state: The lender is able to foreclose without the consent of a judge. Home loans with a Power of Sale clause also allow lenders to forgo the judicial process.
    • Foreclosure TimelineIn a Judicial Foreclosure state: The homeowner defaults on the mortgage. If the debt is not paid back, a Lis Pendens (LIS) is issued, informing the homeowner of the lender’s intent to sue.In a Non-Judicial Foreclosure state: The homeowner defaults on the deed of trust. If the debt is not paid back, a Notice of Default (NOD) is issued, alerting the homeowner of the default.
    • Foreclosure TimelineDuring this Pre-Foreclosure Period, thehomeowner has some options to stopforeclosure: The best option is to pay back the loan in full. If this is not possible, the homeowner may seek loan modification. Homeowners determined to keep their homes may file for bankruptcy. The homeowner may also choose to sell the home as a short sale.
    • Foreclosure TimelineIn a Judicial Foreclosure state: If the homeowner fails to alleviate the debt, the judge will sign off on a Notice of Foreclosure Sale (NFS). The home will be listed for sale at auction.In a Non-Judicial Foreclosure state: If the homeowner fails to alleviate the debt, the lender will foreclose. The property is listed for sale at auction.This signals the start of the Auction Period.
    • Foreclosure TimelineDuring the Auction Period: Potential homebuyers can bid on the home on its scheduled sale date. Auctions are very fast paced, so attending one as a spectator first is recommended.If the home fails to sell at auction, it becomes a RealEstate Owned (REO) property. This may happen if: The home fails to meet an adequate minimum bid or The lender is the highest bidder.
    • Foreclosure TimelineDuring the REO Period: The lender may attempt to sell the home itself, especially if the lender is a large bank with a dedicated REO department. However, not all REOs are sold by banks. Government agencies that provide home loans, such as HUD, FHA and VA, will often sell their foreclosures on their own.
    • Benefits to Buying an Auction HomeAuctions, also known as Sheriff Saleswhen conducted by a sheriff, are themost common type of foreclosure sale.It’s not difficult to predetermine yourmaximum bid if you research theprices for which similar foreclosures inthe area sold. Run a title search and, ifthere’s time, have the home inspected.You want to subtract the cost ofneeded repairs and liens from yourbid.
    • Benefits to Buying a Short SaleSince the home hasn’t been foreclosed on yet,you’d be helping the homeowner and thelender by providing them with the money topay off the defaulted home loan.Short sales provide plenty of time to have theproperty appraised and inspected fordamages.You’ll be allowing the homeowner to walkaway from the home with less credit damagethan a foreclosure would cause.
    • Benefits to Buying an REOREOs allow homebuyers to buy aforeclosure directly from the bank. Somehomebuyers prefer this over buying throughthe homeowner or buying a home atauction.Foreclosures owned by governmentagencies tend to be very well maintained.This may be a huge plus if you areinterested in minimizing the amount ofrepairs you may need to make as much aspossible.
    • For more Information: http://twitter.com/fcdeals http://www.foreclosuredeals.com/wp/feed/ http://www.linkedin.com/company/foreclosure-deals http://www.facebook.com/ForeclosureDeals http://www.foreclosuredeals.com/