If you're among the many people looking to buy foreclosures at auction, don't fear that the decline in filings over the past several months will rob you of your chance at a fabulous buy.
Home foreclosure filings declined steadily from August through February but were still significantly higher than they were a year ago, according to RealtyTrac, a leading online marketplace for foreclosure properties.
Home foreclosure filings for February -- including default notices, scheduled foreclosure auctions and bank repossessions -- numbered 308,524, a decrease of 2% from the previous month, but still up 6% from February 2009. That number means one in every 418 U.S. households received a foreclosure filing in November.
Default notices nationwide were up 3% from the previous month but down 3% from February 2009; default notices were down 25% from their high in April 2009. Scheduled foreclosure auctions were down 1% from the previous month but up 16% from February 2009; scheduled auctions were down 14% from their high in August 2009. Bank repossessions fell by 10% from the previous month but were up 6% from February 2009.
Video: Pearl necklace breaks world auction record
Many of these homes will be sold at auction.
Rob Friedman, chairman of Irvine, Calif.-based Real Estate Disposition Corp., which presides over nearly 500 auctions a year, says potential buyers can definitely get a "steal of a deal" at an auction, but he warns novices to be wary.
"Getting a steal at auction boils down to preparation," Friedman says. The biggest auction mistake, he says, is lack of homework. "You have to set out to quantify risk, inspect the property well, and then quantify the necessary repairs and run price comparisons, or 'comps,' in the neighborhood so you'll know the values."
Is your home's value on the mend?
Many buyers have never attended a real-estate auction before -- either a large auction like those REDC operates or smaller, trickier "trustee auctions" routinely conducted on courthouse steps around the country. Both can be intimidating for novices and fraught with unseen peril, particularly the latter.
Grandmother's Home Sent To Auction Over $398 Taxes.
In the larger sessions, which typically feature dozens of foreclosed homes in a sizable geographic region, novice attendees may feel lost in a sea of bid-calling, whistle-blowing and exotic finger signals.
Experts suggest interested parties test the waters by attending a smaller auction as an observer.
Depending on the size of property, bidders at these auctions will usually need to bring a certified check for $5,000, made payable to their own name, to show the auction firm they have legitimate intent, Friedman says. The successful bidder then signs the check over to the auction company. Losing bidders simply redeposit the check in their accounts.
Larger auctions usually have two or three of the largest mortgage lenders in attendance, though buyers "are certainly allowed to go to their own lenders," Friedman says.
Then there's the matter of the "buyer's premium." REDC and similar firms, such as Oklahoma-based Williams & Williams, usually charge a 5% fee for their services. Friedman suggests that would-be buyers include that sum in the calculations of the amount they are prepared to pay at auction. Unlike trustee auctions, homes at these events nearly always have free-and-clear liens and up-to-date property taxes and fees. smclindon
If you're among the many people looking to buy foreclosures at auction, don't fear that the decline in filings over the past several months will rob you of your chance at a fabulous buy.
Home foreclosure filings declined steadily from August through February but were still significantly higher than they were a year ago, according to RealtyTrac, a leading online marketplace for foreclosure properties.
Home foreclosure filings for February -- including default notices, scheduled foreclosure auctions and bank repossessions -- numbered 308,524, a decrease of 2% from the previous month, but still up 6% from February 2009. That number means one in every 418 U.S. households received a foreclosure filing in November.
Default notices nationwide were up 3% from the previous month but down 3% from February 2009; default notices were down 25% from their high in April 2009. Scheduled foreclosure auctions were down 1% from the previous month but up 16% from February 2009; scheduled auctions were down 14% from their high in August 2009. Bank repossessions fell by 10% from the previous month but were up 6% from February 2009.
Video: Pearl necklace breaks world auction record
Many of these homes will be sold at auction.
Rob Friedman, chairman of Irvine, Calif.-based Real Estate Disposition Corp., which presides over nearly 500 auctions a year, says potential buyers can definitely get a "steal of a deal" at an auction, but he warns novices to be wary.
"Getting a steal at auction boils down to preparation," Friedman says. The biggest auction mistake, he says, is lack of homework. "You have to set out to quantify risk, inspect the property well, and then quantify the necessary repairs and run price comparisons, or 'comps,' in the neighborhood so you'll know the values."
Is your home's value on the mend?
Many buyers have never attended a real-estate auction before -- either a large auction like those REDC operates or smaller, trickier "trustee auctions" routinely conducted on courthouse steps around the country. Both can be intimidating for novices and fraught with unseen peril, particularly the latter.
Grandmother's Home Sent To Auction Over $398 Taxes.
In the larger sessions, which typically feature dozens of foreclosed homes in a sizable geographic region, novice attendees may feel lost in a sea of bid-calling, whistle-blowing and exotic finger signals.
Experts suggest interested parties test the waters by attending a smaller auction as an observer.
Depending on the size of property, bidders at these auctions will usually need to bring a certified check for $5,000, made payable to their own name, to show the auction firm they have legitimate intent, Friedman says. The successful bidder then signs the check over to the auction company. Losing bidders simply redeposit the check in their accounts.
Larger auctions usually have two or three of the largest mortgage lenders in attendance, though buyers "are certainly allowed to go to their own lenders," Friedman says.
Then there's the matter of the "buyer's premium." REDC and similar firms, such as Oklahoma-based Williams & Williams, usually charge a 5% fee for their services. Friedman suggests that would-be buyers include that sum in the calculations of the amount they are prepared to pay at auction. Unlike trustee auctions, homes at these events nearly always have free-and-clear liens and up-to-date property taxes and fees. smclindon