is an action taken against a property owner by seizure of his/her
real property. It can be for many reasons. The main cause is delinquent
payments on a mortgage. The mortgage company or second and even
third mortgage holders contact the owner, then the trustee (usually
an attorney) to begin the process. If it is VA guaranteed or FHA
insured, many times they offer assistance or alternatives. Then
the appraisal is ordered to determine fair market value.
can also be for medical bills, delinquent taxes and other liens,
even credit cards. "The purpose of this foreclosure is for
collection of a debt" is usually printed in the legal section
of the newspaper as well as some other publications, such as local
business papers and law papers.
people feel that they can purchase these properties for almost
nothing and sometimes that is the case, especially tax sales.
If the property is " free and clear" of other liens
then it is solely based on the taxes, penalties and interest due.
I know of some that have sold for less than a few thousand dollars.
owner has the right to cure the default right up to the very last
minute before the sale. A pay off statement is prepared including
the delinquent payments, trustee fees (usually 5 % of the remaining
balance of the loan), processing fees, property inspections, appraisal
and any other thing the mortgage company can think of. The problem
is not only coming up with the funds but knowing what charges
are and if they are legitimate. I have only heard of lawyers and
accountants challenging mortgage companies on over or false charges.
has been in the business twenty years as a licensed real estate
agent, broker and certified residential appraiser who majored
in real estate and architecture. She hopes to improve the industry
one step and one person at a time. Other professionals in the
same fields as well as educators have contibuted.