Buying a foreclosures home

You are speaking of pre-foreclosure situations I believe. Once the property is actually foreclosed on in most cases it goes to auction. There an investor may purchase. If no one purchases at the auction it goes back to the bank and becomes an REO property.

Pre-forclosure properties can be found by checking the county website or going to the courthouse in person to check on the notices of default. This legal document is recorded when the bank first notifies the owner that they are facing foreclosure.

Hopefully your county will have the info on their website, much easier than a trip to the courthouse. Get the list and contact the owners. By Phone, letter and doorknocking.

Find out if your state requires any special extra contracts for someone in foreclosure. For instance: Colorado requires that a seller sign The Colorado Foreclosures Protection Act along with the Purchase contract. Check with a real estate attorney.

Hope that helps,
Michael

Michael,

Not only help! you give me a clear way to stand out from the crowd. I just a little bit confused that can i contact the bank or court instead of contacting of visiting the homeowners.

Thanks
Andrey

You usually work with the home owner while they still own the property (before the foreclosure takes place) If they wait until close to the auction date there is usually nothing you can do for them. You will need to get the final payoff from the lender if there is time.

Michael

Hi Andrey, Michael knows this well, you are in good hands, Jim

If you are going to speak to the bank, you will need to have the sellers provide an authorization to release information to the bank before the bank will speak with you. just google "authorization to release information" and you will see it is a pretty straight forward letter. As Michael said, dealing with people in foreclosure varies from state to state. For instance, here in CA they specify wording and even the size and style of type it must appear in. Here is a portion of CA code regarding foreclosures to give you an idea that dealing with pre/foreclosures is not your garden variety of real estate investing. Not to discourage you, but you need to be aware of the legal requirements in your state, it could lead to problems down the road if you don't follow them.

1695.3. Every contract shall contain the entire agreement of the
parties and shall include the following terms:
(a) The name, business address, and the telephone number of the
equity purchaser.
(b) The address of the residence in foreclosure.
(c) The total consideration to be given by the equity purchaser in
connection with or incident to the sale.
(d) A complete description of the terms of payment or other
consideration including, but not limited to, any services of any
nature which the equity purchaser represents he will perform for the
equity seller before or after the sale.
(e) The time at which possession is to be transferred to the
equity purchaser.
(f) The terms of any rental agreement.
(g) A notice of cancellation as provided in subdivision (b) of
Section 1695.5.
(h) The following notice in at least 14-point boldface type, if
the contract is printed or in capital letters if the contract is
typed, and completed with the name of the equity purchaser,
immediately above the statement required by Section 1695.5(a):

"NOTICE REQUIRED BY CALIFORNIA LAW
Until your right to cancel this contract has
ended,
________
(Name)
or anyone working for ________
(Name)

CANNOT ask you to sign or have you sign any deed or any other
document."

The contract required by this section shall survive delivery of
any instrument of conveyance of the residence in foreclosure, and
shall have no effect on persons other than the parties to the
contract.

1695.4. (a) In addition to any other right of rescission, the
equity seller has the right to cancel any contract with an equity
purchaser until midnight of the fifth business day following the day
on which the equity seller signs a contract that complies with this
chapter or until 8 a.m. on the day scheduled for the sale of the
property pursuant to a power of sale conferred in a deed of trust,
whichever occurs first.
(b) Cancellation occurs when the equity seller personally delivers
written notice of cancellation to the address specified in the
contract or sends a telegram indicating cancellation to that address.
(c) A notice of cancellation given by the equity seller need not
take the particular form as provided with the contract and, however
expressed, is effective if it indicates the intention of the equity
seller not to be bound by the contract.

1695.5. (a) The contract shall contain in immediate proximity to
the space reserved for the equity seller's signature a conspicuous
statement in a size equal to at least 12-point bold type, if the
contract is printed or in capital letters if the contract is typed,
as follows:

"You may cancel this contract for the sale of
your house without any penalty or obligation at
any time before
________________________.
(Date and time of day)
See the attached notice of cancellation form for
an explanation of this right."
The equity purchaser shall accurately enter the
date and time of day on which the rescission
right ends.
(b) The contract shall be accompanied by a
completed form in duplicate, captioned "notice of
cancellation" in a size equal to 12-point bold
type, if the contract is printed or in capital
letters if the contract is typed, followed by a
space in which the equity purchaser shall enter
the date on which the equity seller executes any
contract. This form shall be attached to the
contract, shall be easily detachable, and shall
contain in type of at least 10-point, if the
contract is printed or in capital letters if the
contract is typed, the following statement
written in the same language as used in the
contract:
"NOTICE OF CANCELLATION
______________________________
(Enter date contract signed)
You may cancel this contract for the sale of your
house, without any penalty or obligation, at any
time before
______________________________.
(Enter date and time of day)
To cancel this transaction, personally deliver a
signed and dated copy of this cancellation
notice, or send a telegram
to _____________________,
(Name of purchaser)
at ________________________________________
(Street address of purchaser's place of
__________
business)
NOT LATER THAN ____________________________ .
(Enter date and time of day)
I hereby cancel this transaction ________ .
(Date)
____________________________________"
(Seller's signature)

(c) The equity purchaser shall provide the equity seller with a
copy of the contract and the attached notice of cancellation.
(d) Until the equity purchaser has complied with this section, the
equity seller may cancel the contract.

Who Gets Possession of the Home During the Redemption Period
The original homeowners get to live in the home during the redemption period. If they don’t redeem, they’ll have to move out when the redemption period expires, and that's when you can move in.

The homeowners also have the option of selling the home during the redemption period. If they do this, they must sell it for enough to reimburse you for the amount you paid at the foreclosure sale plus interest.
http://www.nolo.com/legal-encyclopedia/if-i-buy-home-foreclosure-sale-mi...

Don't know if this a doable in Minnesota, but if someone bought the property at the foreclosure, then it must be a deal. Can the foreclosed party sell their right of redemption? if it is transferable, offer them $500 for it then flip the right of redemption to another end investor or the party that bought the property for $1500 or $2000?

Thanks michael,

appreciate your valuable guidelines. thanks for your time

Andery

pretty information,

Thanks this is exactly i was looking for thanks for detail information. I just google "authorization to release information" and found it valuable for me

Andery