Below is a short essay on what and how a home becomes a foreclosure. I know the foreclosure process well, but I do work hard to prevent foreclosure and convert pre foreclosures into win win scenarios. I have large resources of non publishable foreclosure and pre foreclosure opportunities.
No one buys a home with the intention of suffering foreclosure. Foreclosures are caused by various circumstances, but the real bottom line for why most properties go into foreclosure is lack of ability to obtain financing to carry a home owner through a challenging situation.
Almost everyone wants to own their own home. When lending regulations make affordable financing available, most renters will make the switch to home owners. In the recent past, lending regulations were made which allowed home loans to people willing to take calculated risks and move into home ownership. When the regulations were recently changed, many people unable to refinance into more stable loans found themselves in a financial pinch.
When a home owner can not pay their home mortgage there are some options available to them, and some consequences as well.
One of the options is, they can sell their home. There are consequences of selling a home to avoid foreclosure to both the buyer and the seller.
I will cover the consequences in more detail on another page.
When selling a home to avoid foreclosure there are several techniques which can be used. There is a conventional sale if there is equity, there is a short sale if there is no equity, there is an assignment sale, and there is the option of assigning the home back to the lender.
When a home owner falls behind on their mortgage a lender will take action to protect their investment.
A home owner may be able to negotiate a forbearance with their lender, or a modification of terms and restructure their loan to avoid foreclosure, if they know how.
What often happens instead, is that home owners fall behind and then avoid dealing with the pain of communicating with their lender . Lenders can not just take homes away from owner occupants. There is a lengthy process which they must follow to legally reclaim the security for their loans.
This process requires the filing of a notice of default (NOD), a time period, then a notice of trustee sale, and finally a trustee sale at a public auction. In California, this process takes about 9 months.
This is a basic explanation about how properties become Real Estate Owned, or REO.
I know this process very well. I know how to help both home owners and home buyers who are interested in these types of transactions. I can probably write a thousand pages about how to handle these circumstances and create win win scenarios. If you are interested in finding properties like these, or find yourself in this situation, we should talk personally. Call me on my cell (310) 980-8087
