Looking To Buy A Foreclosure In The Sacramento Valley?

Dated: 05/16/2019

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Have you heard that foreclosures or bank owned properties are the way to go to get a bargain?  Well think again

Let's start by talking about the foreclosure process.  In the first stage of the foreclosure process the owner of a home will get what is known as a Notice Of Default or NOD for short.  Simply put this means that the borrower is behind on their mortgage payments.  It could be as little as 1 payment behind or 5+ payments behind as it depends on their bank and how quick they are to issue those notices. These homes also appear on Zillow.com and other sites as "pre-foreclosures".  Sometimes these can be misleading because just because it's listed as a pre-foreclosure doesn't mean the home is for sale. Often times the borrower is able to make up the payment or work out a plan with the lender.  If the owner wishes to sell their home it would be listed as a normal sale with all the other homes.  It could possibly be listed as a short sale if the owner owes more on the house then what it is currently worth.

If for whatever reason the owner isn't able to get current on their mortgage payments the next stage is for the lender to issue a Notice Of Sale. This is a public notice indicating that the home is scheduled for foreclosure auction.  Each county throughout the valley has these at their county courthouse.  Often time though the auction dates get pushed back or cancelled if the owner is able to come to an agreement with their lender.  If they are then they are to be sold at the auction.  With these auctions, there is no inspection or the property done before hand and you do not know as a potential buyer is the property is vacant or occupied.  Additionally, these sales are "cash" transactions.  Meaning if you are getting a mortgage for a home this will not work here, you need to show up at the courthouse with cashier checks in order to pay. 

If no one purchases the house at auction then the house goes back to the bank and is now a REO(Real Estate Owned), bank owned or a home that has been foreclosed on.  Banks can sit on these homes for months to years before they decide to sell them.  Once a bank does decide to sell them they are listed on the MLS along with all the other homes for sale.  For a reference here is a link to all home within Sacramento county that are bank owned or short sales.  

It used to be that banks had so many homes and they were having problems getting rid of them so they were offering them up at deep discounts.  Unfortunately those days have come and gone and out of thousands of homes there might be 100 bank owned homes in the entire county that are for sale.  Because there are no longer a huge surplus of bank owned homes, banks no longer have to sell them for deep discounts.  Nowadays bank owned homes are priced similar to non-bank owned homes.

I'm short sale and foreclosure certified and would be happy to answer and additional questions you may have, feel free to contact me via the link below.

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Derek Jones

Husband and recent father to a beautiful girl. I got into real estate to make a difference on the consumer experience. I have a goal of bringing professionalism back to the industry. I service Sacr....

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