Foreclosure Buying 101 9-7-12

transcript

FORECLOSURE BUYING 101

with RealtyTrac site demo

What we’ll cover today

• A brief introduction to RealtyTrac

• What is ‘Foreclosure?’

• The Three Foreclosure-Buying Opportunities

• The 5 steps to buying a foreclosure

• Site Demo: Using RealtyTrac to:– Find foreclosure and bank-owned homes– Contact lenders & homeowners in default– Find community resources and support

©RealtyTrac Inc. 2012, Not for Distribution 2

A BRIEF INTRODUCTION TO REALTYTRAC

WHO RELIES ON REALTYTRAC DATA

• RealtyTrac publishes the country’s largest database of foreclosure and bank-owned properties– Data from over 2,200 counties, covering over

92% of U.S. housing units

• #1 Foreclosure site – 1.5 million foreclosure and bank-owned properties nationwide– More coverage, more detailed information than

any other national provider

• Unmatched property evaluation and transactional tools– HomeScore, Equity & Loan Info, Property

Analyzer, Online Offers, Foreclosure-MLS Match, and much more

WHAT REALTYTRAC IS

• The RealtyTrac foreclosure database is not an “MLS for foreclosure records”

• Most of the properties in the RealtyTrac database are NOT on the MLS anywhere

– Less than 20% of the homes in foreclosure are listed

– Only 15% of REOs are listed

– Many MLS organizations prohibit including any REO or foreclosure information in the property listings

– RealtyTrac gives you advanced notice that it will likely be ‘For Sale’ in the near future.

WHAT REALTYTRAC IS NOT

WHAT IS ‘FORECLOSURE?’

Foreclosure Overview

What is ‘Foreclosure?’

•Foreclosure is a process that allows a lender to recover the amount owed on a defaulted loan by selling or taking ownership (repossession) of the property securing the loan.

When does foreclosure begin?

•The foreclosure process begins when a borrower/owner defaults on loan payments (usually mortgage payments) and the lender files a public default notice, called a Notice of Default or Lis Pendens.

ARE FORECLOSURES WORTH IT?

• Save money!– Bank-owned properties were discounted 37% in first

quarter– Short sales sold at a 26% discount

• Many properties in excellent condition, but not all

• Fewer buyers – Less competition!

• Motivated sellers

THE FORECLOSURE PROCESS

FORECLOSURE PROCESS

Four Possible Outcomes

1) The borrower/owner reinstates the loan by paying off the default amount during a grace period determined by state law. This grace period is also known as Pre-Foreclosure.

FORECLOSURE PROCESS

2) The borrower/owner sells the property to a third party during the pre-foreclosure period. The sale allows the borrower/owner to pay off the loan and avoid having a foreclosure on his or her credit history.

FORECLOSURE PROCESS

3) A third party buys the property at a public auction at the end of the Pre-Foreclosure period.

FORECLOSURE PROCESS

4) Properties repossessed by the lender are also known as Bank-Owned or REO properties (Real Estate Owned by the lender).

THE 3 FORECLOSURE-BUYING OPPORTUNITIES

PRE-FORECLOSURE

• Contact the owner to make offer

• Purchase from “distressed” homeowner

• Often short sales (but not always)

• Average discounts of 26 percent in second quarter

• More than 500,000 on RealtyTrac

FORECLOSURE AUCTION

• Purchase at public auction

• Contact trustee to verify auction dates

• Often requires full payment in cash

• High risk, high reward

BANK OWNED

• Work with listing agent if listed

• Contact bank to make offer

• Be persistent if not listed

• Submit offers online

• Average discount of 33% in first quarter

5 STEPS TO BUYING A FORECLOSURE

BUYING A FORECLOSURE

1. Search RealtyTrac for properties

2. Get financing

3. Contact an

4. Contact owner

5. Make an offer

REALTYTRAC SITE DEMOa quick look at what you get

CONTACT INFORMATION

• Membership help– (877) 888-8722

• support@realtytrac.com

• Thank you!