What is a Pre-Foreclosure in Atlanta?
Pre-foreclosure is basically the state which a property goes through because of the inability of a property owner to be able to pay the mortgage. Generally, the solution to pre-foreclosure is when a person who has a lot of debt is unable to pay the mortgage he or she can easily put up the house for sale and the next buyer can buy the house and settle up the loan with the bank. Pre-foreclosure is a time when the bank or the money lenders file an inability to pay mortgage claim against the home sellers after the home owners have missed a few of the payments. During the period of pre-foreclosure a property owner generally has two options. The first option is to give the money to the lenders or the bank and settle up the loan and the second one is simply selling the home to someone else and settle up the debt owed to the money lenders or the bank.
Breaking down Pre-foreclosure
Generally, when a person buys a home by taking a loan from the bank or from the money lenders that he or she signs a piece of paper where he or she has to pay up the money to the money lenders on a monthly basis installment. The monthly installment generally has a percentage of principal in them and also the percentage of interest in them. When a home owner is unable to pay the monthly amount to the bank or the money lenders for three consecutive months then the home owner is considered as a defaulter. A Notice of Default will be sent to the home owner to make them know that if their home has now in pre-foreclosure state.
Options for a home owner during pre-foreclosure
When a home owner goes to a pre foreclosure mode then the options for him or her become very much limited. The pre foreclosure period generally depends from bank to bank or money lender to money lender. Generally, the pre-foreclosure is is from 3 months to about 10 months. If the homeowner faces a pre-foreclosure, then the smartest move is to either sell the property or pay for all the monthly installments which were not paid on time. If none of the things are done, then after the process of whole pre-foreclosure is complete the bank or the money lenders will end up organizing a trustee sale or a public auction.
The best thing to do if the homeowners are unable to pay the entire defaulter monthly payments are to put their house for short sale. The short sale will simply help them to sell the house to someone else and let them take care of the loan. With help of short sale, homeowners will very easily be able to keep their credit score good. Generally, everyone who puts up a home for sale during the pre-foreclosed period is generally under short sale. Most of the short sale is private and is done very rapidly between homeowners and buyers.
If the homeowner decides to put up their home for sale, then he or she has to contact a real estate agent and they will set up with al the sale. The approval of the bank is needed for short sale and once the approval is received the transaction becomes smooth. The short sale buyers are generally investors who generally spend money on real estate and later sell it for a much higher price. Buyers can always check out the home before they offer a price or decide to buy it. At times there are situations when the property buyer offers a price more than the pre-foreclosure price which results in the selling the home in the pre-foreclosed state.
Generally, all the real estate investors try to invest in homes which are in pre-foreclosure which helps them to buy the property at a much lower rate and then renovate it and sell it at a much higher rate making a lot of profit in between. If the homeowner takes help of a real estate agent with the property selling, then all the people who want to contact the homeowner should definitely go through the real estate agent in the first place.
Drawbacks and Benefits of Pre-foreclosure
The best thing about selling a home in pre-foreclosure period is that it is a win-win situation for the three parties involved. It is very much profitable for the home property seller because he is able to get out of a debt by selling his or her home without having any kind of effect on the credit score. The buyer gets hold of a perfectly nice home at a very reasonable price. The bank or the money lenders are also getting hold of their all the late payments.
All the buyers of all the property which were under pre-foreclosure need to check all the unpaid taxes and make sure they pay it as soon as the property papers are even handed over to them. The buyer also has to spend money on the repairing of the house which needs to be done. All these factors of repairing and paint only depends on how much of a repairing the home needs.
It is very much important for a person to make sure the value of the property is much less than the vale of the house at a short sale. Since in case of short sale everything moves on so fast all the people should always make sure that they find a price which will be beneficial to them. This article will help you understand the things you need to start your own property dealership or to purchase your new home under short sale. Always make sure you go visit the house and carefully check it before you make an offer pre-foreclosure.
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