Buying a house that’s in foreclosure can be a smart way to start investing in real estate. You can get your own home for a bargain. Therefore, you would have a lot of housing security. Even better, you can buy the house, flip it, and make good income. Do you know how to find out if a house is in foreclosure? Here’s what you need to know …
What Does It Mean to Buy a House That’s In Foreclosure?
When a homeowner is unable to make payments on their mortgage, the lender can take the house back. The house is in foreclosure. Then, the lender can put the house up for auction to recoup some of their costs. They want to offload that property quickly. Therefore, they offer those houses at very low prices. The result is that you can get those homes at a very low price.
How to Find Foreclosure Houses for Sale
You can find foreclosure houses for sale on various websites. For example, Foreclosure.com and Auction.com are two are websites that offer exactly this kind of real estate investment opportunity. Additionally, you can search for foreclosed homes for sale on major real estate websites such as MLS and Zillow.
On Zillow, you would go to the listing type and select “foreclosures” from the Sale section. If you want to see which houses might become available for seen, then you can select both “foreclosed” or “pre-foreclosure” under the Potential Listings section (in contrast to the Sale section.)
In fact, Zillow is a great resource not just for finding the home to buy but also for getting information about how to buy a home that’s in foreclosure. Obviously, the process is slightly different from buying other homes. There are some details to be aware of so that you get it all done as easily, affordably, and appropriately as possible.
How to Find Out if a House Is in Foreclosure
So, that’s how you find foreclosed homes for sale. But how do you find out if a house is in foreclosure? In other words, what if you want to check about the status of a home that you’re interested in purchasing? Zillow lists three good ways to find out if a house is in foreclosure:
1. Search Public Records
There’s a process that the lender must go through when putting a home into foreclosure. Part of that process requires that they file a variety of different legal notices with the county recorder. Those legal notices are public record. Therefore, if you want to find out if a house is is foreclosure, you can check for those public records.
Just go to the county recorder’s office for the county in which the home is located. Search for a Notice of Default, Notice of Sale, or lis pendens. The latter is a public notice that there’s a lawsuit associated with the property. This tells you the state of the home. It’s an easy, free way to find out if a house is in foreclosure.
Tips for Searching Public Records
Tip #1: Sometimes you’ll first need to search the County Assessor’s website. You’ll go there to find out the property’s parcel number. This will also give you the owner’s name. Then you’ll use that information to search the county recorder’s office. SF Gate has more information on this.
Tip #2: Depending on where you live, it’s possible that not all records will be available online. In some counties, you may have to visit the courthouse or City Hall in person in order to search the public records. However, you do have that right. Don’t be intimidated.
Tip #3: Check back often. They update the public records regularly. Therefore, the status can change quickly. If you’re serious about buying a home in foreclosure then you might want to check weekly.
2. Check Government Agencies
There are government agencies that publish foreclosure listings. This is one way to find a house in foreclosure for real estate investing. It’s also how you can check if a house you’re interested in is in foreclosure. Furthermore, these agencies usually make the guidelines really clear for you in terms of what would be necessary to purchase the home. Websites to check include:
- The Federal Housing Administration (FHA)
- Fannie Mae
- The Treasury Department
- Small Business Administration (SBA)
3. Check the Sign
Did you see a house in your neighborhood that you’re interested in purchasing? If so, then you might be able to just check the for sale sign to find out if it’s in foreclosure. Oftentimes, the sign will have a mark reading “foreclosure” or “bank repo.” Then you know for sure that this is the status of the house.
4. Check Bank Listings
In addition to Zillow’s advice, WikiHow offers two more tips. The first is that banks generally list pre-foreclosure and foreclosure homes for sale. You can search their database. If you have a specific address that you want to know about, use that information to find out if a house is in foreclosure.
5. Check the Taxes
Local tax authorities are sometimes aware of the foreclosure status of the home. If you give them a home’s address, then they can search for you to find out if it’s in foreclosure. They aren’t the number one resource but they can be an important tool in your search.
Working with Real Estate Agents on Foreclosure Home Purchases
Another way that you can find out if a house is in foreclosure is to ask the real estate agent. When you call to learn about the property, simply ask. They’ll tell you if that’s the case. In particular, if you see a very low price for a home, then you should ask this question.
If you’re interested in purchasing homes that are in foreclosure, then you might also want to work with a realtor of your own to make the purchase. There are realtors who specialize in exactly this type of home sale. They’ll be able to to help you figure out homes that are available for purchase. Moreover, they’ll know all of the steps to take in order to process the purchase.
Finally, it’s important to know that when a home is in foreclosure, a real estate attorney gets assigned to the property. If you find out the name of that individual, then you can contact them directly. RealtyTrac says that this is the best way to confirm whether or not a home is in foreclosure.
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