How to Find and Buy Foreclosure Properties in Idaho
During the 3rd Quarter of 2007 Idaho ranked 19th Nationally for Foreclosure Properties. There are plenty of them out there, the question is, How do I find foreclosed properties to purchase in ID?
To understand how to find foreclosure homes, you must first understand the foreclosure process. There are several different stages of the process where real estate investors can find and purchase a foreclosure. Each stage has its own strategies, opportunities, and challenges.
Distressed Borrowers...
Foreclosure really begins when Idaho borrowers are in financial distress, and miss a mortgage payment. Banks won't usually do anything until several payments have been missed, but technically can begin the foreclosure process as soon as the due date is missed. This is the earliest stage of the foreclosure process and can only be identified by personal knowledge of distressed borrowers, referral's, or possibly insider information from a bank. Some times homeowners will realize their financial distress and attempt to sell these houses. They are usually hard to identify at this point unless the borrower owes more than the house is worth and must sell it as a Short Sale. The borrowers often try to sell these houses for sale by owner because they realize they have no equity, and can't afford to pay a Real Estate commission. Smart sellers in distress realize they need a Realtors help. Especially a realtor who specializes in Short Sales and foreclosure homes. Houses listed by realtors and on the MLS are usually identified as "short sale" houses. These properties are sold as is, and usually have comments like "motivated seller."
After a distressed borrower has missed about 4 payments, the bank will issue a Notice of Default. The certified Notice of Default tells the borrower that if they do not bring their loan current, the house will foreclose. These notices become public record. They are posted at the county courthouse. You can also get access to these records on online foreclosure sites like foreclosure.com, realtytrac, and bargain network. These services offer a one week free trial period. If you like the service, and find it valuable there is a monthly charge. Personally I like bargain networks service the best. Its format is the best. With that said, Foreclosure.com's service provides the most information without having to pay anything. In many small Idaho towns, the information given without the paid subscription is often sufficient to identify and contact home owners who have received notices of default.
These services also provide valuable information and can give you email updates anytime a new preforeclosure or for sale by owner property is found.
How do I contact owners in default?
Some try door knocking. Some use mailers, some make phone calls. RealtyTrac has programs and campaigns to help you contact default owners to find out if you can purchase those distressed homes.
Notice of Trustee Sales/ Foreclosure Auction
If the loan is not brought current. Aproximately three months after the notice of default another official notice is given. The "notice of trustee's sale" or the foreclosure auction. This notice is posted on the borrowers property, at the courthouse, and in a newspaper. This notice states that the house will close in 28 days. This is the desperation point for foreclosure sellers and many investors with cash like to step in and relieve them.
How do I purchase properties at a foreclosure auction?
Trustee sales usually take place at the court house steps of the county seat. This is a public auction, and anybody may bid on the house to buy a house at a trustee sale you should know that:
You must provide $5,000 certified funds prior to bidding.
Must pay off the entire purchase price in full within 24 hours.
Properties sold at the public auctions are sold without warranties. There still may be liens and judgements tied to the property. The properties might even still have residents needing eviction. Some liens such as second mortgages will sometimes be shafted.
Bank Owned/ REO Homes
Homes that didn't sell at the foreclosure auction almost always appear again on the MLS. These houses are purchased by the bank at the trustees sale, and will be sold "as is." Banks usually want to get rid of these properties fast, so they price them slightly below market value. They are a discount, but they're not always a screamin deal. Bank owned homes are the easiest foreclosed properties to purchase.
A property that is bank owned is known as REO (Real Estate Owned). One of the more common REO foreclosed properties are HUD Homes. Listings of foreclosed homes on the "pay" sites are very often dated. Foreclosed homes are always on the mls.
One of the most common phrases associated with foreclosure, is HUD Homes. HUD Homes are Bank owned homes that were secured by Government back loans. HUD properties only represent a small percentage of foreclosed homes. New HUD homes become available every Friday in Idaho. HUD homes can usually be purchased below market value, but they can usually only be purchased by people intendinding to use the property as their personal residence. If a HUD home is on the market for several weeks, the bidding is then opened up to Investors. Once its open to real estate investors, its usually not the greatest deal. HUD homes are specifically designed for buyers intending to use the property as their primary residence.
HUD Homes can be found in two places, the website of HMB REO (they handle all Idaho H.U.D. properties) and on the MLS. More information and a home inspection report is given on the HMB INC website. This information is very up to date.
HUD homes in Idaho must be purchased using a cooperating real estate agent.
Bids for HUD listings are made on-line. Before you make an online bid you still need to fill out an Idaho Real Estate Purchase Contract and deposit the earnest money check with certified funds. The listing price of HUD homes is usually low, but multiple bids are often made.
Special HUD programs for Teachers, Officers, and Government Workers
There are special programs fore teachers, officers and other government workers where Hud Homes can be purchased for half price. Houses in Idaho that qualify for these program are rare, and are hard to get as bids are selected by a random lottery. These programs still require HUD Auctions through electronic bids. These auctions must be made with the assistance of a licensed real estate agent to bid at a HUD auction. The Realtor gets to choose their own commission.
You can view the teacher officers properties currently for sale by clicking this link on the HMB REO website.
HUD Homes and foreclosers can be found in Boise,
Caldwell,
Eagle,
Emmett,
Garden City,
Kuna,
Meridian, Middleton,
Mountain Home,
Nampa,
Star Idaho, Sun Valley IdahoAmmon,
Blackfoot,
Blanchard,
Bonners Ferry,
Coeur'd Alene,
Lewiston,
Moscow,
Post Falls,
Priest River, Sagle,
Sandpoint, Chubbuck, Bannock,
Idaho Falls, Pocatello,
Rexburg, Rigby,
Shelley,
and even Twin Falls Idaho.
©2008 Alan Sharp Barker, Realtor, Barker Real Estate, forecloser finder.