subject: Santa Monica Foreclosures - Biggest Mistakes To Avoid [print this page] Santa Monica Foreclosures - Search for Them Recommendation 217
I am sure everyone has read the news reports regarding the sheer number of homes going to foreclosure, but how do you go about getting one? Well first off there are lots of Santa Monica foreclosures which are being auctioned off right as we speak so research into that.
Well, you will firstly need to take into consideration the factors listed below:
o Usually the way to get a home which has gone through the above foreclosure procedure is to purchase at aution. It's also worth bearing in mind that you are not usually given any access to the property you wish to purchase prior to the auction. You should however endeavour to at least drive past the house. You'll probably still find people living at the address right up to the auction. A recent example of this was in Santa Monica, where there were several Santa Monica foreclosures due to foreclosure proceedings, where after auctions tenants simply refused to move.
o Winning the auction also does not necessarily imply that you are guaranteed to be able to move into your new home immediately, you will usually have to adhere to eviction laws prior to this. This throws open the chance that the previous occupants of the house may still be residing in the property. What is usually an attractive solution to this potential problem is to consider paying those still in the house a few hundreds dollars or so to move. At the end of the day, it will save you time and money in the long run just to pay around $ 1, 000 to the occupants to avoid any problems arising. This tactic was one which those people who had Santa Monica foreclosures recently employed.
o It's also sensible to find out whether the house was occupied during the winter months. If the property was vacant, you may have frozen pipe damage.
o The Sheriff's office will usually have the ability to offer you a portfolio of properties which are in the foreclosure process.
o In order to ensure a smooth transaction and that you pay a fair price, speak to your local REALTOR for advice. This will enable you to know what sort of price the house will sell for.
o It's also advisable to ensure that you are fully aware of all the liens involved with the house in question. (A lien is anyone who has a financial involvement in the property for example a bank.) This info can be obtained via contacting the office of the Recorder of Deeds. All liens on property should be recorded, but you can check with your local municipality to be aware of the rules in your area.
o The order of priority in terms of liens is usually viewed like this:
1. Federal Tax
2. State Tax
3. Local Tax
4. 1st. Mortgage recorded.(normally, this is the primary mortgage)
5. 2nd Mortgage recorded (commonly a home equity loan or similar).
o What commonly happens is that when the higher ranking party forecloses the lower ranked liens are wiped clean, apart from TAX liens. However, this may not necessarily be the case and therefore it is worth doing your research. Please find below a few examples. These generally use Santa Monica foreclosures for examples.
1. The home has 10K in tax liens, 200K in first mortgage and 50 K in second mortgage. The consequence of the auction is that the house sells for $250,000. Well firstly the tax would be paid, then the primary mortgage and then anyone left over money would be paid to the remaining creditors. You'd then own the home fully and the title on the property would be wiped clean. (This is by no means 100% guaranteed to happen though, this will depend on the rules in your state.) In Santa Monica the rules on Santa Monica foreclosures are notoriously strict.
2. The property which has 50K in tax liens and is foreclosed by the government for TAX Sale. As well as this tax lien, the property also has $250,000 in secondary mortgages. This will clear the tax lien that initiated the foreclosure process and usually all other loans ranked lower. If this occurs the primary mortgage creditor will bid on the property to protect their financial interests in the property.
o It is commonplace that if you should win the home you pay around 10% up front at the auction house. The balance is due within 30 days.
o Another good piece of advice which you should follow is to hire the services of an experienced attorney and perform a title search on the property.
o If you don't find any other liens on the property then go ahead and pay the outstanding balance.
o If the title search indicated that you GOOFED, then you will have to decide if it is in your best interest to complete the deal or loose your 10% deposit.
o If all is well and you are happy to continue then pay the rest of the 90% and ensure that you record the deed, (your lawyer will help you).
o You will obviously want to gain immediate access in most cases, (you will not usually receive any keys though). You own the property though. (It is possible that in some areas the parties being evicted can actually reverse the procedure through paying their debts This is particularly true of Santa Monica foreclosures.) You will of course be able to still access the property.
o If you discover that the house isn't vacant then you will have to go through an eviction process, or pay around $1000 as advised at the beginning of the article.
As you have seen, there is a great deal of risk in buying a foreclosure. It is far from the simple transaction which many see it is. There are various other alternatives though to choosing a foreclosure property.
1. Talk with a local realtor and buy the house through the normal channel. In this case banks will commonly lower their lien to avoid the chance of a foreclosure. This process could have prevented Santa Monica houses going up for sale.
2. Another little-known way of buying a house is to actually contact banks and creditors and make an effort to purchase homes off them. Banks also commonly used realtors to advertise their properties available, so contracting a REALTOR will aid you in this process. On a side note, if you are looking to buy in California then check out the properties for sales in California, especially Santa Monica foreclosures.
Choosing a foreclosure can be extremely rewarding. But the flip side to this is the massive risk involved. Please make sure that you know what you are in for, if you choose to pursue this route.
Just remember to hire the services of a licensed REALTOR. Your contact, which must be prepared professionally, should ensure that the house you are considering purchasing is completely clear of all liens or the closing will not occur. You may have seen on the news the recent cases were those buying Santa Monica foreclosures were recently caught out by not carrying out proper research.
Best of luck if you are planning to buy a property through by this means. For those who don't want all that risk, then my advice would be to contact a REALTOR and start looking around. Realtors have responded to the massive demand for Californai homes by finding many people Santa Monica foreclosures.
(All of the wording provided here is just for your reference. Each areas laws differ. Just make sure you check up on those laws prior to making any big decisions.) If you are searching at homes in Cali, then you may want to consider Santa Monica foreclosures.
