Here are the four basic steps to the home foreclosure process which can and will help prospective investors to purchase properties at the best possible price.
1. Pre-foreclosure- This is the stage which a property owner starts missing payments and the stress of falling behind starts to mount. Keep in mind that this stage is before any legal action has begone. A property owner may be more likely at this time to consider any offer if it means they have a chance to save their credit and avoid foreclosure. This is the best time to make a deal with the home owner and make this a win-win situation.
2. Notice of Default- A formal notice to a borrower declaring that a default has occurred and that legal action may be taken.
3. The foreclosure sale- Whether it is a judicial or non-judicial process depends on each individual state as each state can have different laws. The foreclosure sale process itself can take up to a year to complete. Quite often judicial foreclosure sales are held on the courtroom steps as soon as a judgment has been reached.
4. Redemption period- During this stage some states allow the property owner the opportunity to get title back, provided they pay the full amount of the original debt and any new fees that they may have accumulated.
Investors need and should know if the foreclosed property they wish to purchase has a redemption period or not. As an investor you won’t want to make any type of improvements to the property until you know for sure that it is yours.
Hans Anderson
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Tags: foreclosure, home, process