You see them on the television, late at night or early in the wee hours. They are excited, they are perky, they are ‘wealthy’ and they are telling you how much you can make by buying Foreclosure Properties.
There is, in fact, money to be made in the foreclosure market. That fact does not, however, point up the actual work it takes to enter and make a ‘fortune’ at it.
Foreclosures: Their Loss, Your
Foreclosures come in various types, most commonly mortgage default and tax default. In mortgage defaults the bank holding the mortgage will be looking for a sale that gives not only the balance on the loan, but additional funds to cover their expenses for having to process the repossession. In some cases you may still be able to purchase the home for a significant discount on the rest of the area market.
Your local Saint Augustine FL real estate experts would be best able to advise you on market value and if you are looking at the property as an investment or ‘flip’ what the projected margin may be.
Tax default foreclosure is a civil action brought by a town/city, county, etc for delinquent real property taxes. Those taxes pay for everything from the schools and roads to the police and fire department. Falling behind in those taxes allows the municipal government to sell the property to recoup the taxes. These are the foreclosures you see on the television showing only ‘hundreds paid’ for large, expensive properties. Finding the properties available means a trip to the town or county local finance offices for their list of homes scheduled for sale. Some realtors track this as well, so your realtor may already have the information.
Buying on the Court House Steps
The sales for foreclosures are often done at the local court house, for both bank and tax foreclosures. Your financing needs to be in place before you go. Think carefully during the auction process. It’s very easy to get caught up in the procedures of bidding and loose track of your budget in a bidding war. It is no bargain if you offer to pay more than you can afford because you wanted to ‘win’.
Some auctions are done as a ‘silent’ bid. You will have a time limit in which to submit a written bid. The high bidder takes the property. If there is a tie, they may request a second bid from the bidders who are in the tie. Again, remember your budget. Winning the auction is not winning if you have over spent your limits.
You Bought the House, Great. Now What?
Something that can happen with a tax sale that may not be present with a bank sale is that the prior owners may not have yet been moved from the house. Tax sales can require some special assistance to get the house vacated and your realtor is a good resource for that information. If you are not working with a realtor, check with the court that holds jurisdiction for legal remedies for your problem.
This is something they don’t mention on all those television infomercials. The time to research your options and the reality of the process is before you put your money on the line. Your St. Johns County property agents can advise you.
Date: 2008-03-26 13:38:00