Foreclosed Homes for Sale
Bank and government foreclosed properties at discounted prices
Homeowners get mortgage loans to finance their purchase of houses. Banks foreclose when monthly payments are not made for three consecutive months. Some banks sell their loans to government agencies buying mortgage loans from the banks. And, some loans have insurance coverage by government agencies. In such cases, government agencies foreclose on properties.
Bank foreclosed homes for sale
Commercial banks, credit unions, and other mortgage-financing financial institutions repossess homes (REPOs) as a result of non-payment of mortgage loans. Bank-foreclosed real estate properties are called Real Estate Owned (REO) or Other Real Estate Owned (OREO) and their foreclosure sales are handled by REO units. Some banks assign sales to professional real estate agents or mortgage brokers.
No matter how bank-owned homes are sold, you, as a real estate investor or home buyer get a significant discount. The reason is simple: banks do not want to deal real estate sales. Their business is to collect deposits and extend loans. Second, the primary intention of the bank is to recover its loan, including its principal and accumulated interest.
Bank foreclosures offer great opportunities especially after the financial crises caused by insolvency of many banks as banks are more willing to get rid of real estate properties tying their liquid funds to illiquid properties. Start your search of bank foreclosed properties by obtaining bank foreclosure listing and getting appointments to see the properties.
Government foreclosed homes for sale
Homes foreclosed by government agencies are sold at discounted prices by Housing and Urban Development (HUD), Veterans Administration (VA), Fannie Mae, Freddie Mac, Internal Revenue Service (IRS), U.S. Customs, local Sheriff's office, local tax administrations, and a variety of other public agencies. In some cases, homeowner cannot pay their taxes and their houses are foreclosed.
HUD foreclosures are sold by HUD-registered real estate agents. VA-foreclosures are not sold directly but by Ocwen Federal Bank FSB, a private company assigned to sell real estate foreclosed by VA.
You can buy HUD-owned home and get financing from Federal Housing Authority (FHA) at special interest rates and low down payment.
Expect low- to mid--market homes when you want to buy government foreclosed properties, primarily bougth by first-time homeowners who lost their jobs or bougth properties that they could not afford.