East Millcreek Utah Foreclosures
There are different stages of the foreclosure process where real estate investors and home buyers have opportunities to purchase foreclosured properties.
Below is a summary of the foreclosure stages, and how you as a buyer can act to find yourself a East Millcreek foreclosure deal.
Pre-Foreclosures in East Millcreek
The foreclosure process begins when home owners miss several payments and receive a "notice of default". The notice of default tells distressed homeowners that they are now responsible to pay the loan balance in full, or else the property will be sold at a public auction. The notice of default is usually received after about four missed mortgage payments. The owners usually have about three months before the foreclosure auction will take place. If you have received a notice of default, and would like a free consultation click this link: Stop Foreclosure
Many East Millcreek preforeclosures are for sale and are listed on the MLS. However, the majority of them are not for sale. Many real estate investors attempt to contact these distressed owners, and offer to purchase their homes below market value to help them avoid foreclosure and preserve their credit. These homes can be found on sites like Foreclosure.com, Realty Store.com, and Realty Trac.
East Millcreek Short Sales
Owners of pre-foreclosure homes and condos often owe more than the property is worth. By refinancing, and taking out home equity and second loans they make themselves vulnerable to foreclosure. They forget that home equity loans, are "loans" and that they will have to repay them. It is still possible to purchase homes that are upside down by using "short sales". Banks do not want properties to foreclose. It is in their best effort to lose money by approving a short sale than to allow the property be sold on the court house steps. When a East Millcreek house is in short sale status, Many East Millcreek short sale houses are listed for sale on the MLS. They are noted with a special "SS" mark by the listing.
The Trustee Sale -- Foreclosure Auction
A foreclosure sale, foreclosure auction, or Trustee auction is the actual Foreclosure. In East Millcreek, this auction takes place a the County courthouse. This is a public auction where anyone may bid on the property if they:
- Provide $5,000 certified funds prior to bidding. An "official check" will not work.
- Have the ability to pay off the entire purchase price by noon of the following day.
- Are willing to take the risk of purchasing a properties without warranties express or implied. Houses for auction at the county courthouse may still have judgements tied to them.
- Are willing to evict the current occupants. Many foreclosure properties still have residents needing eviction.
Purchasing a property at a Trustees Sale can be fairly risky. Some big investors purchase these distressed properties "site unseen." Many distressed properties are on the market before the auction but can not be sold in time. In these instances, investors can walk through them before the foreclosure auction, but often times they are not. When a distressed home has several loans against it, and the amount of the sale is not enough to satisfy all the liens the junior liens get shafted. East Millcreek Foreclosure Auction homes can often be purchased at a large discount when there isn't a lot of competition. Homes with second loans are prime candidates for Trustee auction deals.
East Millcreek Utah REO - Bank Owned Homes - Post Foreclosure homes
When nobody bids on a home at the public foreclosure auction, the property becomes becomes a Real Estate Owned (REO) or bank owned property. The large majority of the time East Millcreek REO homes will be listed with a Realtor and are found listed on the MLS. In the MLS notes the owner will usually be listed as "REO" or "Bank Owned." Banks don't like carrying homes and so usually will price it low to try and sell within three months. East Millcreek REO Homes are sold "as is."
East Millcreek HUD Homes
One of the most common phrases associated with foreclosure, is HUD Homes. East Millcreek HUD Homes are Bank owned homes that were secured by Government back loans. New HUD homes become available every Friday in Utah. HUD homes can usually be purchased below market value, but they can usually only be purchased by people intendinding to use the property as their personal residence. If a HUD home is on the market for several weeks, the bidding is then opened up to Investors. Once its open to real estate investors, its usually not the greatest deal. The fact is, HUD homes are the hardest foreclosed homes to purchase as an investor.
HUD Special Programs
HUD offers a special teacher next door program. The goal of this program is to encourage teachers to buy homes in revitalization areas. As per the guidelines, you must be "employed full-time by a public school, private school, or federal, state, county, or municipal educational agency as a state-certified classroom teacher or administrator in grades K-12."
However, there are property type restrictions (No duplexes, no triplexes). Also, the homes cannot be other real estate for sale in the area (so forget the 3-bedroom home in the new subdivision down the street-no new construction). HUD sells all qualifying homes as-is and it does not provide any warranties.
The good news-there are tons of revitalization areas across the country listed and sold exclusively over the Internet. Every week a bid is awarded. And the bid must be the amount of the list price. The computer randomly selects each bid and it is posted each week on the web. I advise clients to enlist the services of a professional real estate agent even though they think they understand the program requirements and bidding process.
It's important to note that a borrower will be required to sign a silent second mortgage and note for the discount amount. No interest or payments are required as long as they fulfill the three-year occupancy requirement. For this point alone, I recommend that a borrower read the fine print carefully. It turns out there are no free rides, even on a good neighbor program. Here are a few URLs that will provide more information on this program.
Rehabbing and Flipping East Millcreek Homes
HUD Homes and Foreclosure Houses are usually in pretty beat up condition and require some rehabbing. Not all foreclosures are fixer uppers. Many distressed properties are newer and in very good physical condition. For those with craftsman skills, rehabbing foreclosed homes is an excellent way to invest in real estate.
