CLICK HERE TO SEARCH BANK OWNED HOMES
Foreclosures
The assistance in buying and selling foreclosures is a large component of our real estate business and we can provide you with the knowledge, expertise and service to navigate throughout the foreclosure process.
Investment Opportunities
Investing in foreclosures is an excellent opportunity to purchase real estate at fair market value, or depending upon market conditions, below fair market value. The foreclosure market does create investment opportunities; however there are risks and the procedures involved that are much different when purchasing “general” real estate. It is a wise course of action to be cautious when purchasing foreclosures and it is strongly advised to work with a professional to help take you through the process.
The entire process of purchasing a foreclosure is different and a buyer needs to understand that their patience and cooperation will be needed. Each lending institution has different policies and procedures but in most instances these lending institutions will require the following:
- Offer response may take between 2 – 7 days.
- Multiple offers are commonplace.
- Special bank addendums are required.
- Buyer must provide a pre-qualification letter from their lender.
- Buyer must provide proof of funds for cash offers.
- Buyer must provide an earnest money deposit.
- Properties usually sold as is.
- No verbal offers will be accepted.
- Seller will not warrant the presence of condition of personal property.
- No pre-occupancy prior to closing.
- Repairs are not allowed prior to closing.
These are just a few of the major differences between purchasing a foreclosure home versus a traditional purchase. The Doher, Perry & St. Gordon Team will provide you with the expertise, knowledge and experience to take you through the entire process and has all of the tools and resources to search out all of your foreclosure purchase opportunities.
Avoiding Foreclosure
Following is some information and guidance on the possible alternatives in avoiding a foreclosure. These are just a few of the possible solutions that may be available to you; however you need to contact your mortgage lender or counseling agency for your options. There are different policies and procedures among lending institutions and loan types; such as FHA, VA or Conventional loans.
What is a foreclosure?
If you are not making your monthly mortgage payments, then your lender has the legal means to file a foreclosure proceeding and repossess your home. When the lender has completed the procedure and are in legal title, then you must vacate the home. Also, if the home is worth less than the amount owed on the home, then there is the possibility that the lender may file for a deficiency judgment. A foreclosure or a judgment should be avoided if at all possible as it will affect your credit qualifications in the future.
What Do I Do?
You should not ignore the correspondence from your lender as they may be able to offer you some possible solutions, commonly known as Loss Mitigation, which may be able to help you in resolving your financial difficulties. You can also contact a HUD-approved housing counseling agency for any government, private sector or community programs that could help you; they may also offer you credit counseling and are usually cost free.
Possible Resolutions
- Mortgage Modification – your lender may be willing to refinance or extend the term of your mortgage. This allows you to make up back payments by reducing your monthly payment and extending the time to pay back the loan.
- Special Forbearance – your lender may arrange a repayment plan that will allow you a temporary payment reduction or a temporary suspension of your payment. You may qualify for this type of program and is usually based on your financial situation. You will have to provide your lender with information that you will be able to qualify and meet the requirements of a revised mortgage payment plan.
- Deed-in-lieu of foreclosure – a process where you give back the property to the lender and avoid a foreclosure sale; however you will have to vacate the home and there are still derogatory credit rating issues.
- Pre-foreclosure sale – depending on current market value and the amount owed, which will include accrued interest, penalties and other fees, you may be able to sell the property prior to losing the home to foreclosure.
- Short sale –where the lender will accept a mortgage payoff that is less than what is actually owed. The lender will normally require an appraisal to determine current market value.
Be Aware!
Believe in the old adage, “if it sounds too good to be true then it probably is”. There are many scams that attempt to take advantage of you and your financial difficulty. Beware of phony counseling agencies that will approach you in an offer to negotiate with your lender or attempt a pre-foreclosure sale for an upfront fee. These are services you can perform yourself, or receive for free from a legitimate counseling agency. You can call a HUD-approved counseling agency at 800-569-4287 for information prior to paying anybody or signing any documentation. Also beware of the “We Buy Homes for Cash” solicitations, even though some may be legitimate offerings, there are many that will offer the opportunity to save a foreclosure by promising to pay off your mortgage or provide you monies when the property is sold. What they may be attempting, is to have you vacate the home, sign some documents, possibly a deed, and then rent the home and pocket the monies until the actual foreclosure date.
