Purchasing an Atlanta home in foreclosure or pre-foreclosure may be the opportunity you have been searching for. Many homeowners in a pre-foreclosure situation are often looking for a solution to foreclosure, which may mean stopping a foreclosure with a qualified contract. And that’s where you, the homebuyer, come into the picture.
If you find a home in pre-foreclosure, the homeowner’s lender may make concessions by discounting the loan amount or stopping the foreclosure sale should you sign a qualified contract.
Pending foreclosures may offer you a “bargain” in terms of purchasing price, and the number of foreclosures on the market may increase the likelihood that you’ll find a home in pre-foreclosure or foreclosure.
What does pre-foreclosure mean?
When searching for homes in this pre-foreclosure state, you may want to look for the terms “pre-foreclosures” or “pending foreclosures” or "short sale."
These terms essentially mean that the properties are currently in default with the lender and are therefore being advertised for foreclosure by the lender. If the properties don’t sell, they will likely be sold at auction or foreclosed by the lender.
How does purchasing a pre-foreclosure benefit me?
You may benefit from purchasing a home in pending foreclosure because the homeowners are likely eager to sell their property, which means that you will often purchase the property for less than you would have if it wasn’t in foreclosure.
The home buying process is no different for a pre-foreclosure sale than any other real estate transaction. The owners of the property have the right to sell, regardless of the pending foreclosure status.
Is it better to buy a pending foreclosure or wait until it goes to the foreclosure auction?
If a pending foreclosure does not sell, it is then offered to the public at a foreclosure auction. All foreclosures in Georgia, including Atlanta, occur on the first Tuesday of every month, from 10:00AM to 4:00PM at the superior court house of the particular county.
A foreclosure may benefit you because you are able to purchase the property outright, which eliminates the need to negotiate with the homeowners.
It may, however, prove to be tricky because buyers in a foreclosure auction rarely have the opportunity to inspect the property beforehand.
It is also important to have a title search conducted prior to the sale of the property in case there are any liens on the home which would not be taken care of during the foreclosure sale.
The state of Georgia extinguishes any liens on the foreclosed property, except for IRS liens, which remain on the property for 120 days after the sale. In other words, the IRS has 120 days to take action to protect its interest during this period, or their rights will be waived.
How the auction process work?
The lender’s attorney “cries the bid” to the buyers at the foreclosure sale, with the opening bid being placed on behalf of the lender. This bid generally includes the remaining principal balance of the loan, back payments, accrued interest and attorney fees.
Should you outbid everyone else in the auction, you must provide the total amount of the bid on the spot, and it must be presented in cash or certified funds. The attorney for the lender then prepares and issues a Deed under Power of Sale. This deed then transfers the property ownership to you.
How do you find home in forclosure?
We've done the hard work for you and have added the ability to search for Atlanta forclosures. We explain how in another post, you can read it by clicking here. How to find Atlanta Foreclosures.
For more information on Atlanta Real Estate, contact Tina Fountain Realtors at 404.842.1555.