Search For Inside Info On Foreclosures
by: ELAINE ZIMMERMAN
Buying a
foreclosure
can be a lucrative investment. Finding a
foreclosure before
anyone else -- or a "pre-foreclosure" that allows you to be the only
person negotiating with a motivated seller -- can give you an
additional advantage.
Understanding the
foreclosure
process gives you some insight into locating foreclosures at their
earliest stages.
The federal government forecloses on hundreds of thousands of homes
each year. Banks and financial institutions take back homes that they
have loaned funds against. They refer to the properties they retrieve
as REOs.
In some cases and with some additional effort, you can find these homes
before their foreclosures, or pre-foreclosures.
When you review the databases further, you will notice that many
smaller banks do not include their REO listings. They might have too
few foreclosures to have an REO department. Contact these institutions
directly and ask for the name of the person designated to dispose of
these properties. Your effort might reap information about properties
that are not in any public database.
Real estate agents are another source for finding properties before
foreclosure.
As you become familiar with an area, you might notice homes that appear
to be vacant without any "for sale" sign. You can obtain the phone
number for the address from a reverse directory. Many times when people
leave a home, they forward their calls to a cell phone or other number.
You may reach an owner ready to sell quickly.
Newspapers can be another source of information about pre-
foreclosures. Check "for sale by owner" and "homes for rent" ads.
Sometimes these represent the last efforts of homeowners who are so
strapped that they can't afford to lose money toward a real estate
commission.
You can also use your newspaper proactively to find pre- foreclosures.
When you have identified the area in which you wish to purchase, place
an ad in that section.
If you wish to obtain investment property, your ad can say, "Will buy
your home, you stay in your home" accompanied by your phone number. In
this case, you buy the home from the seller and then either lease or
lease/buy it back to them.
If you wish to buy the home without tenants, you can run a similar ad
without the option of the sellers remaining in their home.
Finally, public court documents give you information about homes 30 to
180 days prior to foreclosure. In every state, a legal notice must be
filed before a foreclosure can be finalized. The length of time between
the initial legal action and the final resolution varies nationwide,
but the procedure is the same.
In most states, a "forcible detainer" is filed. It may indicate the
property address, name of the homeowner and amount owed. This action is
filed prior to the actual foreclosure and gives you enough information
to contact the homeowner directly. In many states, forcible detainers
are also used to evict apartment dwellers, so you must check the
address of the property to determine if it is a home or an apartment.
Buying a foreclosure or a pre-foreclosure from a motivated seller can
be a good investment for you, and in the case of pre- foreclosure, a
good solution for someone else.
For more information, visit www.bankrate.com.
Scripps Howard News Service
Copyright The Chicago Sun-Times, Inc.
Provided by ProQuest Information and Learning Company. All rights
Reserved.
