What Are Foreclosure Sales

Foreclosure sales occur when a be a bank or a building society, sells the property in possession of a homeowner when the latter defaults on his principal or interest payments on his or her mortgage. When a buyer wants to purchase real estate, he borrows the money from a lender by getting into a contract. One of the conditions of the contract is that in case of a default in the principal or interest payments, the lender can take possession of the property and sell it to recover the mortgage debt and legal costs. Foreclosure is the legal proceeding by which the mortgagor’s equitable right of redemption is terminated by the lending party.

Before foreclosure sales happen, the homeowner is given the chance to pay the lender the outstanding of the debt and redeem his property. If the borrower fails to pay within three to six months, then a Notice of Default is recorded by a trustee against the borrower and a reinstatement period of about five days starts after which the home is auctioned off.

After the default, a foreclosure sale date is established and a Notice of Sale is received by the owner and also posted on his property. The Notice is recorded at the County Recorder’s office and published in newspapers. At the Trustee Sale, the property is sold off to the highest bidder who receives the Trustee’s deed to the property. Payment is usually made in cash in foreclosure sales.

The opening bid in foreclosure sales is set by the foreclosing lender. This includes the loan due, interest accumulated and other legal costs undertaken for the auction. If there are no higher bids, then the property is purchased by the attorney conducting the sale, on behalf of the lender. In the above case, the property is considered a Real Estate Owned. This is likely to happen if the property‘s worth is less than the amount due to the lender.

The properties listed for foreclosure sales can be found by various ways. One way is to search public records. Visiting the County’s Office can provide us with information on a Notice of Default or a Notice of Sale. This can be done free and one can get to know about the latest foreclosure sales here. Alternatively, one can search online for foreclosure data providers. By availing an online listing service, one can check the free trial offers to see which provider best suits you. Both national and regional foreclosures are listed.

Contact me if you need help with any and all of your real estate needs. 

Written by Carol Pefley

www.carolpefley.com

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