Here’s the foreclosure process…
If a home owner misses their first payment, the lender pays little attention. If the owner doesn’t make a payment by the 15th of the month, the lender will typically mail a notice saying their payment is past the due date and a late payment fee is added to the payment.If the owners miss the next payment, the lender begins to get a bit nervous.
So far, the owner has missed two payments and is more than 30 days past the due date. When an owner misses two payments in a row, a Notice of Default, or NOD, is issued and delivered by certified mail to the owner.
The NOD is then recorded as a public document. The NOD will show the amounts needed to bring the loan current and is the beginning of the foreclosure process.
If the owners misses a third payment in a row, the lender can file for foreclosure.
The foreclosure process filing is also public record, and this is where investors find potential real estate investment opportunities.
Since this is a public record, you’re not the only one aware of the owner’s situation.
Soon, the owner can be bombarded with “let us buy your house” offers in the mail or even personal visits.
The owner is obviously going through a rough time and can be compounded by those who want to buy the house for cheap but also scam artists that prey on someone’s misfortune.
You can search public records on your own for NOD and foreclosure filings or you can buy this information from companies that glean such information for a fee.
Either way, just remember that when you approach homeowners with an offer, put yourself in their shoes for a moment.
Empathize with them and understand, the foreclosure process, and what they’re going through.
By presenting an offer in a respectable manner that can benefit you, your buyers and the owners, you’ll have much more success in the foreclosure market.
This way, everybody wins.
It's often hard to remember to work with lenders even during a foreclosure process. Many just want to give up and stonewall the bank as they get ready to vacate. " presenting an offer in a respectable manner" is common sense but on a whole not often practiced.
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