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Buying Properties in Default
Part 1, Part 2
IThis information is based on Nevada law and may
differ in other States. Dealing with troubled Real Estate can be demanding, profitable, risky and rewarding. Someone
thinking about Buying a distressed property or Selling their home that is or is going into Default should be fully
prepared and knowledgeable into the positives and negatives of their decisions. You should have, at a minimum,
the assistance and guidance of a professional Realtor that has experience in dealing with properties in this type
of situation. The potential for realizing a significant profit is very good in downward or upward markets as long
as you have a knowledgeable Realtor assisting you or you have the appropriate knowledge and expertise to be able
to weave through all the potential problems that can and usually do arise in this type of transaction. The advantages
to buying properties from homeowners in default can only be measured by the individual investor. Some do not see
enough reward, some think it's too risky, while others are plagued by moral issues. Are you helping the troubled
homeowner or taking advantage of his misfortune? The advantage to a homeowner to sell their property prior to losing
it at auction is significant and can sometimes be the difference between having to rent for the next 5 years or
so, or be able to purchase another home within a short while if not immediately. Both the lender and the homeowner
can lose in a foreclosure action. Neither want it to happen and the focus must be toward a Win/Win situation for
all parties involved. Both parties must be motivated to resolve the situation and is the main key to the process.
The first public investing window of opportunity opens the day the Notice of Default or Breach is filed. This lets
the homeowner and the general public know that the homeowner has Defaulted or Breached the terms of their Mortgage
and needs to make good on the loan, by bringing it current or paying it off completely. The window closes the day
the property is sold at auction. The time between these two events enables an investor to work with the homeowner
and lender to create a workout strategy or a purchase of the property from the homeowner before the sale date.
The amount of time the window remains open depends solely on state and local laws, as well as the behavior of the
property owner. The behavior of the property owner with the Bank is one of the most influential items in just how
the Bank is going to deal with the current property owner. Several options are available from the Bank to homeowners
such as modifying the current loan, foregoing past payments, adjusting interest rates and payment amounts. Maintaining
an open line of communication between the homeowner and Bank can be difficult at times and it usually is best to
utilize one of the newest emerging specialties the Loss Mitigation Consultant. The Loss Mitigation Consultant is
a third party that helps bridge the gap between the homeowner and bank. They can assist in preparing and analyzing
which options are truly best for all parties involved and can be the key to a homeowner selling the property and
saving their credit rating. Nevada sells properties within 90-120 days from the first notice of default.
As for the moral question, keep in mind that by dealing with a homeowner in default, you not only help him, you
generally rescue the loan and maintain the value of the property (and surrounding properties) as well. If there
is enough equity in the property, there is the potential to work out an arrangement that satisfies all parties
and allows for a handsome profit. That's what pre-foreclosure investing is all about: buying the equity in the
property, working out an arrangement with the lender and the homeowner, then selling the property for a profit.
Following theses basic guidelines should ensure
a successful purchase and sale:
1. Locate loans in default
2. Evaluate choices and narrow selections
3. Contact homeowner
4. Inspect property and loan documents
5. Determine homeowner's needs
6. Calculate your selling price and profits
7. Negotiate with lender, owner and lien holders
8. Close the deal
9. Repair as necessary and sell
Real Estate Reports
BUYER REPORTS
SELLER REPORTS
REO Asset Services was specifically started to serve
the Las Vegas Foreclosures Real Estate needs of Banks and Financial Institutions in the disposition of their Bank
Owned foreclosed homes. So if your looking for a Las Vegas Foreclosure or Bank Owned Foreclosed Home, REO, VA or
HUD Repos, we are the Company for you. After all we are:
"Your Las Vegas Real Estate Connection!"
We also handle the marketing and purchasing for most
difficult or specialized Real Estate transactions: Properties in Default - Pre-Foreclosure - Bankruptcy - Divorce
- Probate
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