RE/MAX of Hot Springs Village
No matter how you look at it, the business of buying and selling properties at or near foreclosure is not a happy one, especially for the homeowner involved in the foreclosure. It is possible, however, that it can be a mutually beneficial transaction for a willing investor and that distressed homeowner. Home foreclosure is the legal process where a lender attempts to recover the balance of an unpaid loan from a borrower by forcing the sale of the home used as the collateral for the loan. For a shrewd investor, purchasing foreclosed properties can be a terrific real estate deal, and hopefully, if the transaction occurs during the pre-foreclosure stage both parties to the transaction win by profiting from a timely transfer of title—which produces a good investment for the investor and divestment for the homeowner, which may save their credit rating. It’s important to know that profiting from foreclosures isn't the no-brainer many assume it to be – for each success story, there are likely to be a number of horror stories. Every real estate transaction involves risk. While investors with the very best intentions can help to reduce their risk, they cannot completely eliminate it.
According to Wikipedia, Foreclosure is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan, usually a home.
What drives sellers into foreclosure? They may have been laid off or fired from their job, unable to work due to a medical condition, have home maintenance conditions they can no longer afford, are arguing in a divorce, or are heavily in debt and unable to pay their bills.
Interested in purchasing a home in foreclosure? Sometimes the foreclosed property is not available for viewing. The problem with buying a house sight unseen is that you can't calculate how much it will cost to improve the structure or bring it up to habitable standards.
Thinking of investing in “distressed property”? In the pre-foreclosure stage, investors will likely be able to do the most good for the distressed homeowner and for themselves, without lender involvement.
A key investment decision to make is where to enter into the foreclosure process. To achieve the most success at becoming a long-term investor of distressed properties, it is critical to identify one of the three stages and become an expert in that particular process.
There are three ways to acquire distressed property, based on where the property lies in the foreclosure process. The three stages are as follows: pre-foreclosure, foreclosure, and post-foreclosure.
How is a short sale different from a foreclosure? A short sale is a transaction in which the bank lets the delinquent homeowner sell the home for less than what's owed. A foreclosure is the process in which a lender (often a bank) takes back possession of an unpaid property.
Arkansas has a relatively low rate of foreclosures (1 in every 4153 housing units) compared to the other 49 states.