Foreclosures and Short Sales
Foreclosed, bank-owned (REO), and short sale properties are great ways to get a good deal on a home purchase. But they're not for everyone. We have dealt with all types of properties over the years, and can guide you through the maze of the purchase process for each. We are a HUD-approved broker, and only HUD-approved brokers can submit offers on their properties listed for sale. HUD, the U.S. Department. of Housing and Urban Development is the government agency that regulates FHA, the Federal Home Administration home mortgage insurance program. Fannie Mae, the Federal National Mortgage Association, which is not a government agency, purchases certain FHA mortgages from banks in addition to conventional mortgages, to free up cash, so banks can make more loans . For an article on the differences, see FHA-FNMA Differences. Freddie Mac, the Federal Home Loan Corporation, is another GSE, "government sponsored enterprise", like Fannie Mae, but purchases some FHA-insured Savings & Loan mortgages instead of FHA-insured bank loans. What's the difference between Fannie Mae & Freddie Mac? Click here to see.
Go to the Fannie Mae site to find FNMA-foreclosed properties: Homepath.com.
Go to the Freddie Mac website to see their foreclosed properties: Homesteps.com.
Go to the HUD website to find FHA-foreclosed properties: HUDHomestore.com.
When a home is foreclosed on at the sheriff's sale, and the highest bidder is the bank, that is when they become bank-owned, aka, real-estate owned (REO) properties. As HUD has insured these homes, and Fannie Mae and Freddie Mac have purchased the loans, they need to be paid back, and must approve the offer submitted to the mortgagee (bank or S&L) by the seller's real estate broker. FNMA, FHLC, and FHA properties are listed with a managing broker in the Multiple Listing Service (MLS). When you find a home on either one of these websites, contact us to make an appointment to see the homes.
Short Sales are homes that are not foreclosed yet. The owner has notified the bank that they can no longer make the monthly payments, and have asked for the bank to accept less than the mortgage amount in order for them to get out of the payments before the home goes to foreclosure. Foreclosure "Lis Pendens" usually has been filed, and the seller is in pre-foreclosure, with a right of redemption. Nowadays, banks are making more of an effort to help owners stay in their home, which actually makes the Short sale process longer. Here's a good article about Short Sale vs. Foreclosure: Short Sale vs. Foreclosure. These homes will usually be listed for sale in the MLS. The mortgagee will have to accept any offer made to the seller for a short sale to go through. It is a long process, taking over 90 days to close in many cases. The bank may not take your offer, or they may ask the seller to contribute something to the sale. It is not for everyone.
We have years of experience with all types of distressed properties. Call us for help buying short sales, foreclosed and bank-owned homes. You can also search for foreclosures and short sales from our Search Listings page, using Advanced Search.
