Do All Foreclosed Homes go on Foreclosure Listings?

The foreclosure list does not include all foreclosed homes available. The foreclosure list is a snap shot of those homes that are being sold by the lien holder because the homeowner could not continue to make mortgage payments. However, depending on the list you are using, you may only see a glimpse of the foreclosed homes for sale in your area.

Private Foreclosure listings

When you research a foreclosure list, either in print or online, you should take a look at who is responsible for creating that list. For example, if there is a bank's emblem on the top of the list, then you should understand this list is only for homes that are now owned by that bank. The same is true of a realtor's foreclosure list. Even homes that are in foreclosure may be represented by an agent who will receive a commission on the sale. The agent is working for a bank, not for a home owner, but still has an incentive to only show you options for homes he or she will earn money on.

Pre-Foreclosure Listings

There are a number of homes that are approaching foreclosure but have not officially been foreclosed on yet. These home owners are looking to get out of their current mortgage, and may be in a short sale situation. These are often the best deals on the market. While foreclosed homes may go for months unoccupied or be damaged by distraught homeowners, short sale or pre-foreclosure properties have generally been more well-maintained. Pay attention to "short sale" listings to look for this option.

Mortgage Buyout

There are a number of private investors on the market who are willing to buy mortgages out of default, foreclosure or bankruptcy situations. One popular scenario is for these investors to them offer to rent the home to the previous home owner, giving them an opportunity to remain in the property. These investors often have inside information about the homes that are in pre-foreclosure situations. They will purchase the homes before the homes hit auction, meaning a typical home buyer will not have access to these houses.

Foreclosure Auction

Once a home goes to auction, it will be on the foreclosure list. A home auction typically takes place in a community facility where investors and home buyers alike come to bid on the low-value homes. These auctions can be intimidating for an inexperienced home buyer, and they should be attended carefully. A good strategy is to review the foreclosure listing before attending. Go to see the homes that peak your interest on the list, and then determine what you are willing to big on these homes at auction.

Subordinate Lien Holders

Many people will have more than one mortgage on their home, meaning more than one lender will have a lien on the property. This can keep the home off of foreclosure listings while the subordinate lender either takes over the primary lien or receives some other form of financial compensation. Often, when a home owner defaults on a second mortgage, the second lender will purchase the primary mortgage then force the home into foreclosure.

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