What is a foreclosure? And should we wait longer for possibly better deals?

Asked by Joseph, Los Angeles, CA Sat Dec 8, 2007

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Tammy Hayes, Agent, Port Charlotte, FL
Fri Oct 29, 2010
Foreclosure is the enforcement of a lien. It is accomplished by legal proceedings in court as the result of nonpayment of a debt. Foreclosure terminates the rights of the owner and results in the public sale of the property used to repay the lien. If the sale does not bring enough money to pay the existing balance on the mortgage, the lender can file a claim for deficiency judgment.

A deed in lieu of foreclosure is an alternative to a foreclosure sale. A mortgagor who is in default can voluntarily deed a property to a lien holder in lieu of payment of a debt. It offers several advantages to the borrower and the lender. It releases the borrower from personal debt associated with the loan. The borrower also avoids public notoriety of a foreclosure proceeding. And lastly, it does not hurt the borrower's credit as much as a foreclosure.
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David Chiles, Other Pro, Los Angeles, CA
Fri Oct 29, 2010
The Foreclosure process starts when a homeowner cannot pay the mortgage and ends when the home is resold. The three stages of Foreclosure are: Pre-Foreclosure, Auction, and REO/Bank Owned. Pre-Foreclosure is the time period a homeowner has to repay the delinquent amount of the mortgage. If a homeowner does not pay the mortgage the home is auctioned. If the bids do not meet the reserve the lien holder (bank) reclaims the property and it becomes a Bank Owned REO.

I suggest getting the best deal possible for the best property available because the market may remain flat or drop slightly in the next few months due to government intervention.
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Jim Walker, Agent, Carmichael, CA
Mon Oct 11, 2010
Jim Cramer's prediction in December 2007 was closer to the mark than my prediction.
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Heather Paul, Agent, Santa Monica, CA
Mon Oct 11, 2010
A foreclosure home is also known as an "Reo" property, this means the previous homeowner could not afford there mortgage payment and by default on their loan the bank has taken the home back from them. The home prices are outstanding right now and interest rates are offering 20 year lows meaning this is one of the best times in history to buy a home. I would not recommend waiting longer if you are looking for a great deal as homes have started going up in value and have risen for the last 4 months, the rise is moderate however steady.

I would recommend getting a real estate agent that specialize in both Reo "foreclosure" properties as well as short sale properties. I left you my website below, you can search the mls for free on my website, also call me or email me anytime. I personally specialize in both foreclosures and short sale properties and would love to help you find a great home.

Have a great day,
Heather Paul
Coldwell Banker
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Royal Real E…, , 90275
Sun Oct 10, 2010
Foreclosure is a process which secured lender/mortgage company commences, when property owners fails to tender regular monthly payment .

Usually, mortgage would start foreclosure process when at least two or more monthly payments are missed by the property owner. its usually started with Notice of Intend to foreclose, unless all the defaulted amount is paid within 30 days from the date such intent letter is issued by lender.

if owner fails to cure the defaulted payments within alloted time, lender would commence the foreclosure process by issuing , recording and service, Notice of Default . Borrower has 90 days from date of the Notice of Default to cure the default, before a Notice of Trustee's sale is published and served. Notice of Trustee's sale is usually gives 21 days notice prior to auction sale. Borrower , in CA, has 5 days prior to sale to pay the defaulted amount and reinstate the loan. if borrower fails to reinstate the loan, Lender may proceed with the trustee sale, at the date, time and location. Lender may continue the trustee's sale notice, either upon the request of borrower or due to its own reason.
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Nino and Ami…, , Modesto, CA
Wed Dec 19, 2007
Merced, Stanislaus, and San Joaquin Counties, in the Central Valley of CA from Merced to Modesto / Stockton boast the highest number of Foreclosures-- bank owned properties-- in the USA. We are flooded with inventory, and if you plan to buy and hold for the next 5-7 years, now is the opportunity time to invest in rentals, or move-up to your dream home. Prices are down 50% over the last 24 months, especially in the range of $300k-900k. Houses are selling within 90 days when priced below $250k.
If we can be of assistance or answer any other question, please feel free to give us a call (209) 613-5773 or send an email: NinoP@kw.com.
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Jim Walker, Agent, Carmichael, CA
Wed Dec 19, 2007
Jim Cramer ( "Mad Money" screaming host ) was on the "Today" show this morning. Cramer predicted 18 months before the end of the bottom of the market.

My personal prediction differs in that we are at the bottom of the market, and that prices will stay low for the next 12 months. They will neither fall much further. nor will they climb much.

Disclaimer: Current sales will not record until January or February and they will not be reported in the media until March and April, So you will see reports through the spring of falling prices. They will be reporting past history (Dec 2007 ) as if it is current and future trend.
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Fred Dawson, , San Pedro, Long Beach
Tue Dec 11, 2007
Hello Joseph, Hope all is well. A foreclosure in a nutshell is a bank owned property also known as an REO property. Secondly, are you looking for a specific area? Most Realtors have access to REO properties, however you need to find a realtor that you work well with and that you trust to get you the best deal possible. If I can be of assistance or anwser any question please feel free to give me a call (310) 678-3247. or send me an email: freddawson@firstteam.com
Web Reference:  http://www.freddawson.com
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The Hagley G…, Agent, Pleasanton, CA
Mon Dec 10, 2007
shortsalesheep.com has more info on foreclosures, as well as links to most major lenders and gov't agencies with foreclosed homes. Good luck!
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Deborah Madey, Agent, Brick, NJ
Sat Dec 8, 2007
Foreclosure is a process in which a lender legally demands that a property be sold (sheriffs sale) in order to collect monies due on a mortgage. If a buyer purchases the property at or before the sheriff sale, the lender is paid. If no buyer is produced, the lender becomes the owner of the property. Each state has different laws regarding the process and right to redemption. This is a Realtor definition; I am not an attorney.

Foreclosure is a process that begins w/ a lender serving a notice of default when payments are missed, and subsequent legal notices and filings. A property remain "in foreclosure" for various time periods, depending upon the state and the particular circumstances surrounding the property.

Some buyers believe that the properties in which sellers have fallen behind represent potential good deals for the buyer. This is not always the case. Not all properties in foreclosure are for sale. Other properties may not have sufficient equity to effect a simple sale, and instead require additional approvals (short sales). At such time the foreclosure process is complete and a lender takes back a property, the sale price established by the lender may be at fair market value.

Depending on your local market, there may be better deals that do not carry the risks or uncertainties the accompany foreclosures. Properties in foreclsoure may bring additional complications in clouded titles, short sales, lenders who are slow. Meanwhile, there may be other sellers in the same marketplace who are highly motivated to sell. A foreclosure can sometimes result in a good deal, but do not limit your search here. Why ignore other potential good deals that carry less risk?
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