Finding Foreclosure Bargains

The process isn't quite a simple as those TV gurus promise. You often have to buy sight unseen (as far as the interior goes), you need to have financing available immediately, and you should certainly work with a lawyer who's familiar with the process. When a mortgage is being foreclosed and the property sold at auction, the proceeding is handled by a court-appointed referee. Notice of the impending sale is published once a week for three weeks, and you can find these notices in local newspapers. If an address interested you, the next step would be to contact the plaintiff (the lending institution) or the law firm handling the proceeding, often listed in the notice. Ask the terms of the sale (how much of the bid in immediate cash, and how many days to come up with the rest,) and get some information about the property. Because the house still belongs to the homeowners, you cannot insist on inspecting the interior. At the auction, if the only other bidder is the lender who bids the amount left on the mortgage, you can sometimes pick up a bargain. But you must promptly present a certified check for a substantial percentage of your bid. Financing the rest is your own problem, often within a month. Houses acquired by HUD through FHA foreclosures are often listed in the newspapers. Some are sold in "as is" condition, for all cash. Others have been renovated and decorated, and HUD may offer attractive mortgages with little down. Many real estate brokers have master keys for entering these houses, which are vacant. To buy one, you work through a local broker, filling out a sealed bid that is transmitted to HUD. Much the same procedure applies with VA foreclosures, which can also be a source of bargains.