THE FORECLOSURE PROCESS

The foreclosure market can be one of the most effective options to purchase a home. CRN has extensive experience and knowledge in this market to give you insightful tips that can get you over the renter’s hump and into homeownership.

A Property Foreclosure: A Clear Explanation

Although the real estate industry can be intimidating and confusing, many of its elements are actually fairly straightforward. Take, for example, a foreclosure.

A foreclosure, in real estate terms, is the legal process by which the lender or the seller forces a sale of a mortgaged property because the borrower has not met the terms of the mortgage. This is also known as a repossession of property.

After the property is re-possessed, it can be sold by auction or through an REO (Real Estate Owned) sale. During a foreclosure auction, the property is sold to the highest bidder. In an REO sale, the foreclosed property enters the lender’s asset inventory. Then, the lender sells the foreclosed property in the general market through an appropriate agent. Auctions and REO sales are discussed in detail later in this guide.

Why Should I Care About Foreclosures?

When lenders and banks foreclose on a property, they may turn around and sell the property at a discount to market values. This is why new home buyers may find bargains through foreclosure listings.

It’s important to remember that lenders, such as banks and government agencies, are not property managers or realtors. They generally have no interest in pursuing the marketing and leg work required to sell a home. As a result, they often want to sell these properties as fast as possible and with as little effort as possible.

If you research the foreclosure market carefully, you may find deals on homes. Be wary, however, because some foreclosures are not good deals and can entail a wide range of headaches. The more organized and informed you are – pay close attention to comparables and specific details about the condition of house – the more confident and happier you’ll be in your purchase.

Where to Find Foreclosures CRN provides foreclosed property listings that pull together information from an extensive collection of resources that include: Banks Department of Housing and Urban Development (HUD) Department of Veterans Affairs (VA) Farmer’s Home Administration Federal Deposit Insurance Corporation (FDIC) Federal Home Loan Mortgage Corporation (Freddie Mac) Federal National Mortgage Association (Fannie Mae) Government agencies Government-sponsored institutions Insurance companies and other private mortgage lenders Mortgage companies Private lenders Savings and loans companies Small Business Administration (SBA)

Because CRN has access to all of these resources, you gain entrance into a world of listings and opportunities that can lead to the purchase of your first or next home. Our proprietary database contains tens of thousands of property listings, including foreclosures and other bargain opportunities.

A note of caution: lenders and government agencies do not always update their databases and listings. At times, up to 20% of foreclosure listings may already be in escrow or sold. Although this can be frustrating for buyers, it is important to remember that more than 80% of listing may be accurate. There are many opportunities out there, so don’t get discouraged if you come across some incorrect or outdated information.