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 A foreclosure is the process whereby a lender or beneficiary recovers the amount of debt owed on a defaulted home loan via a public auction of the property. There are specific steps that must be followed in order to start the foreclosure process once a borrower has defaulted on their loan. There are basically four stages to the foreclosure process. Notice of Default (Pre-Foreclosure Period) At this time, the lender has a Notice of Default filed by the trustee at the county recorder’s office. During this period, the borrower may still be able to reinstate the loan or pay it off. Likewise, the lender may accelerate the loan, requiring the borrower to pay the loan in full. After this stage, it is 3 months before the lender can take the next step. Notice of Trustee Sale (Foreclosure Period) Three months after the Notice of Default, the lender notifies the borrower of foreclosure. They announce they are putting the property up for auction by filing a notice at the county recorder’s office. Also, a sign is posted at the property and the information is published in the local newspaper. Auction Typically held on the courthouse steps, this is a public auction where the opening bid is set by the lender and the property is sold “as-is.” The highest bidder must pay in full on the spot with “cash in hand.” Post-Auction If there is a winning bidder, they receive the deed to the property. If there is not, the lender takes back ownership of the property and it becomes a Bank Owned or Real Estate Owned (REO) property. What Does This Mean to a Buyer? The Waller Group is highly skilled at helping buyers purchase homes during the different stages of the foreclosure process. Take our extensive knowledge of foreclosures and add it to our keen negotiating skills and our complete grasp of the Dallas real estate market, and you’ve got a powerful combination working for you. Dependent on your objective in purchasing a foreclosure, there are several strategies we can employ to result in a successful transaction. The best thing to do is schedule an appointment with a member of our team to go over your goals, accessibility to funds and our services. Some of the most common ways a buyer may purchase a foreclosure property are as follows: Short Sale This occurs when a lender agrees to accepts proceeds from a sale that are less than the loan balance on a property usually to avoid the expenses involved in a foreclosure. The homeowner owes more than the home is worth and negotiates a sales price that is lower than the amount owed. In this case, the homeowner is released from their loan obligation and avoids foreclosure, the buyer has equity in the home, and the lender is spared the time and expense of foreclosure. Foreclosure Auction The lender offers the property for sale at the courthouse steps where buyers can bid on homes. Homes may be purchased quickly and at considerable discounts. However, buyers must pay on the spot with “cash in hand” and the properties are sold “as-is” without the benefit of appraisals, inspections, title insurance and more. Real Estate Owned (REO) These properties are bank owned properties that were not sold at auction. The benefits of this type of transaction are that the buyer does have the benefit of a motivated seller as well as an agent, appraisal, inspection, title insurance and more. If you need the assistance of The Waller Group for the purchase of a foreclosure or bank owned property, do not hesitate to contact us! If you are currently in need of Foreclosure Assistance, please visit TexasForeclosureAssistance.com. 
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