| With Foreclosures hitting record limits this year | | | | After that time the Bank must auction the home and |
| Investors are coming out to get deals and it is a great | | | | give public notice of the auction. The home owner can |
| time to get them. But When you look for foreclosures | | | | make the back payment and retain the home right up |
| you see some advertising Foreclosures and some | | | | until the home is Auctioned. Once the Auction begins |
| advertising REO's or Bank Owned properties and | | | | Investors/ Buyers can bid on the home and the highest |
| some advertising Pre-foreclosures. | | | | bidder wins the home based on Bank Approval. The |
| Let's clear up the confusion. Foreclosure is a process - | | | | Auctions are rarely absolute auctions and the bank |
| When an owner of a home that has a loan on the | | | | must approve of the final sales price to agree to the |
| home fails to make their payments the Bank | | | | deal. |
| Forecloses on the home to take ownership of the | | | | If the home is not sold at the Auction the Bank takes |
| home. This process takes different time in in different | | | | over the home and then usually sells it through an |
| states but generally the home owner is 3 to 6 months | | | | affiliated Real Estate Company. This is what is called |
| behind on their mortgage when the bank will begin the | | | | Real Estate Owned or (REO) |
| Foreclosure process. | | | | So if you are a buyer looking for a home that is |
| When the Bank issues a NOD or Notice of Default - | | | | discounted and you want to deal with a Bank you |
| this is a public notice that the bank is beginning the | | | | would ask your agent to look for REO properties not |
| Foreclosure process. At this point the Home is in Pre- | | | | Foreclosures. |
| Foreclosure and the Home can sell the home to a | | | | Banks do offer deals on REO's from time to time and |
| buyer or investor and clear their debt with the bank | | | | if you work with an agent that deals with REO |
| and avoid the Foreclosure all together. | | | | properties they will be able to notify you when those |
| Depending on the the state the Home remains in | | | | opportunities are available. |
| Pre-foreclosure anywhere from 30 days to 6 months. | | | | |