Foreclosure Buying 101 9-7-12

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Learn the basics of buying a foreclosure property, including how the foreclosure process works, the three foreclosure-buying opportunities and the five steps to buying a foreclosure.

Learn the basics of buying a foreclosure property, including how the foreclosure process works, the three foreclosure-buying opportunities and the five steps to buying a foreclosure.

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  • 1. FORECLOSURE BUYING 101 with RealtyTrac site demo
  • 2. What we’ll cover today • A brief introduction to RealtyTrac • What is ‘Foreclosure?’ • The Three Foreclosure-Buying Opportunities • The 5 steps to buying a foreclosure • Site Demo: Using RealtyTrac to: – Find foreclosure and bank-owned homes – Contact lenders & homeowners in default – Find community resources and support©RealtyTrac Inc. 2012, Not for Distribution 2
  • 3. A BRIEF INTRODUCTION TO REALTYTRAC
  • 4. WHO RELIES ON REALTYTRAC DATA©RealtyTrac Inc. 2012, Not for Distribution 4
  • 5. WHO RELIES ON REALTYTRAC DATA©RealtyTrac Inc. 2012, Not for Distribution 5
  • 6. WHAT REALTYTRAC IS • RealtyTrac publishes the country’s largest database of foreclosure and bank-owned properties – Data from over 2,200 counties, covering over 92% of U.S. housing units • #1 Foreclosure site – 1.5 million foreclosure and bank-owned properties nationwide – More coverage, more detailed information than any other national provider • Unmatched property evaluation and transactional tools – HomeScore, Equity & Loan Info, Property Analyzer, Online Offers, Foreclosure-MLS Match, and much more©RealtyTrac Inc. 2012, Not for Distribution 6
  • 7. WHAT REALTYTRAC IS NOT • The RealtyTrac foreclosure database is not an “MLS for foreclosure records” • Most of the properties in the RealtyTrac database are NOT on the MLS anywhere – Less than 20% of the homes in foreclosure are listed – Only 15% of REOs are listed – Many MLS organizations prohibit including any REO or foreclosure information in the property listings – RealtyTrac gives you advanced notice that it will likely be ‘For Sale’ in the near future.©RealtyTrac Inc. 2012, Not for Distribution 7
  • 8. WHAT IS ‘FORECLOSURE?’
  • 9. Foreclosure Overview What is ‘Foreclosure?’ •Foreclosure is a process that allows a lender to recover the amount owed on a defaulted loan by selling or taking ownership (repossession) of the property securing the loan. When does foreclosure begin? •The foreclosure process begins when a borrower/owner defaults on loan payments (usually mortgage payments) and the lender files a public default notice, called a Notice of Default or Lis Pendens.©RealtyTrac Inc. 2012, Not for Distribution 9
  • 10. ARE FORECLOSURES WORTH IT? • Save money! – Bank-owned properties were discounted 37% in first quarter – Short sales sold at a 26% discount • Many properties in excellent condition, but not all • Fewer buyers – Less competition! • Motivated sellers©RealtyTrac Inc. 2012, Not for Distribution 10
  • 11. THE FORECLOSURE PROCESS
  • 12. FORECLOSURE PROCESS Four Possible Outcomes 1) The borrower/owner reinstates the loan by paying off the default amount during a grace period determined by state law. This grace period is also known as Pre-Foreclosure.©RealtyTrac Inc. 2012, Not for Distribution 12
  • 13. FORECLOSURE PROCESS 2) The borrower/owner sells the property to a third party during the pre-foreclosure period. The sale allows the borrower/owner to pay off the loan and avoid having a foreclosure on his or her credit history.©RealtyTrac Inc. 2012, Not for Distribution 13
  • 14. FORECLOSURE PROCESS 3) A third party buys the property at a public auction at the end of the Pre-Foreclosure period.©RealtyTrac Inc. 2012, Not for Distribution 14
  • 15. FORECLOSURE PROCESS REO 4) Properties repossessed by the lender are also known as Bank-Owned or REO properties (Real Estate Owned by the lender).©RealtyTrac Inc. 2012, Not for Distribution 15
  • 16. THE 3 FORECLOSURE-BUYING OPPORTUNITIES
  • 17. PRE-FORECLOSURE • Contact the owner to make offer • Purchase from “distressed” homeowner • Often short sales (but not always) • Average discounts of 26 percent in second quarter • More than 500,000 on RealtyTrac©RealtyTrac Inc. 2012, Not for Distribution 17
  • 18. FORECLOSURE AUCTION • Purchase at public auction • Contact trustee to verify auction dates • Often requires full payment in cash • High risk, high reward • More than 300,000 on RealtyTrac©RealtyTrac Inc. 2012, Not for Distribution 18
  • 19. BANK OWNED • Work with listing agent if listed • Contact bank to make offer • Be persistent if not listed • Submit offers online • Average discount of 33% in first quarter • More than 600,000 on RealtyTrac©RealtyTrac Inc. 2012, Not for Distribution 19
  • 20. 5 STEPS TO BUYING A FORECLOSURE
  • 21. BUYING A FORECLOSURE 1. Search RealtyTrac for properties 2. Get financing 3. Contact an Agent 4. Contact owner 5. Make an offer©RealtyTrac Inc. 2012, Not for Distribution 21
  • 22. REALTYTRAC SITE DEMO a quick look at what you get
  • 23. CONTACT INFORMATION • Membership help – (877) 888-8722 • support@realtytrac.com • Thank you!©RealtyTrac Inc. 2012, Not for Distribution 23