In Salt Lake City alone there are more than 1,000 properties in the preforeclosure stages. These are borrowers who have missed payments, received a notice of default, or have a Trustees Sale Scheduled. There are also about an additional 500 foreclosed, REO, HUD, and bank owned houses in SLC.
There are different stages of the foreclosure process where real estate investors and home buyers have opportunities to purchase foreclosed properties. When homeowners stop making payments, the lender has no choice but to foreclose on the property.
Below is a summary of the foreclosure stages, and how you as a buyer can find a Salt Lake City foreclosure deal.
Pre-Foreclosures in Salt Lake City
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 SLC Foreclosure
Many SLC 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.
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 Salt Lake City house is in short sale status, Many Salt Lake City short sale houses are listed for sale on the MLS. They are noted with a special "SS" mark by the listing.
A foreclosure sale, foreclosure auction, or Trustee auction is the actual Foreclosure. In Salt Lake City, this auction takes place a the Salt Lake County courthouse 450 S. State Street Salt Lake City Utah. 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. Salt Lake City 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.
Salt Lake City 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 Salt Lake City REO homes and Condos 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. Salt Lake City REO Homes are sold "as is."
One of the most common phrases associated with foreclosure, is HUD Homes. Salt Lake City 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 Homes and Foreclosure Houses are usually in pretty beat up condition and require some rehabbing. Not all Salt Lake 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.
I have an Associate Agent who is behind on her mortgage payments and wants to list her condo as a short sale. I've not run across this situation before and I'm unaware of whether or not the lender will pay her side of the commission if sold in a short sale. Has anyone run across this situation? Will the lender allow the Agent to receive a commission?
Sure a Realtor facing short sale can make a commission, as long as the transaction paid for is not the agents' house........ I just don't know how you could negotiate with the bank about the value of your house, shaft them in away, but then get expected to get paid on it. Even if one could get away with it its not ethical.
