What is foreclosure? This question at the top of our list of frequently answered questions (FAQ)! Many buyers and sellers have heard the term "foreclosure", but many are not really sure as what it means. Depending on who we are talking to, the answer to this simple question can convey a vastly different meaning.
The simple answer to "what is foreclosure" is that the bank has taken ownership of a home - usually due to the mortgage not being paid for several months. Once buyers and sellers hear this answer, other questions follow and the conversations that come out of "what is foreclosure" can lead almost anywhere.
Foreclosure is a legal matter and it requires an attorney. It can be quite complicated and it can also be a rather lengthy process. For a homeowner, the end result of foreclosure can result in losing ownership of their home and being evicted by a Sheriff. Losing a home to foreclosure is a devastating and life changing event.
While in pre-foreclosure, a homeowner can continue to live in the house. There is usually a period of time where the homeowner can "pay up" the mortage to bring it current and take the house out of foreclosure. Foreclosure has a lasting affect on your credit report - as long as 7 to 10 years. Foreclosure laws vary by state and there are different types of foreclosure. If you are served with foreclosure papers, we suggest that you contact an attorney immediately.
For a homebuyer, "what is foreclosure" can indicate a buying opportunity - a "deal". A foreclosed property that is listed for sale is a "distressed" sale. It is a "bank owned" or an "REO" property and generally is priced aggressively to get it sold quickly. Expect a foreclosure property to be an eyesoar and to be in great disrepair as once the bank owns it, they will not keep up with home maintenace.
If you have any questions about foreclosure or if you would like a list of foreclosure properties, Email us!