Foreclosures--- Understanding The Process Is Crucial! If you are considering purchasing a foreclosed property or short sale, we can help walk you through the process! We have included a variety of information and resources on this page about short sales and foreclosures. Please contact us if you would like to preview REO or short-sale properties!
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. The foreclosure process begins when a borrower/owner defaults on loan payments and the lender files a public default notice, called a Notice of Default or Lis Pendens. The foreclosure process can end one of four ways: 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. 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. 3. A third party buys the property at a public auction at the end of the pre-foreclosure period. 4. The lender takes ownership of the property, usually with the intent to re-sell it on the open market. The lender can take ownership either through an agreement with the borrower/owner during pre-foreclosure via a short sale foreclosure or by buying back the property at the public auction. Properties repossessed by the lender are also known as bank-owned REO Properties (Real Estate Owned by the lender). |
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