Selling and buying a home is important business that requires vital information, especially if the home is in foreclosure. There are more details to consider and more decisions to make when contemplating selling or buying a foreclosed home.
A foreclosed home, also referred to as a bank-owned property or REO (real estate owned property), is a home that is owned by the lender after the previous owner failed to pay the mortgage payments. Generally what happens after foreclosure is that the homeowner is issued a notice of default after the fourth missed payment, and then the lender takes you to court to take possession of the property. This is known as a judicial foreclosure, where the lender can pursue a judgment for the balance owed on the home after the auction.
Because selling and buying a foreclosed home can become problematic, it is advisable to seek the assistance of a foreclosure real estate agent who can help with the complicated process.
Selling a foreclosed home can be a long and painful process for a homeowner. You can legally sell a home in foreclosure up until the home is sold at auction. You can also rescue your home by paying the lender or bank everything owned, including penalties and back payments. In some states, you are given a right of redemption, which allows you to take the home back for a period of time in which you can repurchase your home.
Buying a foreclosed home is not easy, sure you get great pricing, but it can sometimes take a lot of house hunting and writing many offers. Most foreclosed homes are vacant which will speed up the process of buying and moving in. Find a specialized agent and get pre-approved for a mortgage. And remember, a foreclosed home is sold as-is.