Buying Daytona Beach Foreclosed Homes
Daytona Beach Foreclosues Listings (Include Daytona Beach Shores)
Note: The listings below are based on how local real estate agents tag or code listings. Unfortunately, not all listings are tagged correctly. We have other agent only tools available through our MLS Dashboard so we can find additional listings for you. Just give us a call at 386-566-7503.
Have you heard everyone talking about foreclosed homes, investing in foreclosures, and property foreclosures in general? The Daytona Beach real estate market has been hit with many foreclosures and there are opportunities for patient buyers. If you've wondered what all the buzz is about concerning foreclosure homes and foreclosure condos, here's is a quick crash course to help you understand the process and your role is in investing in foreclosures. Yes, you can save big money, you can also lose money.
Over the past several years the U.S. housing market as taken a great hit and has slumped badly. Prior to this, lenders were loaning money too freely to almost anyone. This has led to an overwhelming amount of homes in foreclosure. The focus of this article will be Daytona Beach area foreclosure real estate, and Daytona foreclosures in particular, where rapid price increases and speculation, coupled with a stagnation and subsequent rollback of home values, has led to a glut of foreclosure homes.
What is a Forclosure?
In Florida, when someone purchases a home, they hold the deed, if they have a mortgage on that house, the lender holds a lien against the home. When an owner, or mortgagor, misses multiple payments on a property the lender, or mortgagee, will file a lawsuit (Lis Pendens) against the mortgagor. At this point, the mortgagor will be given a period of time to respond and the home is considered in foreclosure. If the mortgagor fails to respond, the court will make a judgment and a date will be set for the property to be auctioned. On the prescribed day, usually thirty days later, the foreclosed houses will be auctioned on the county court house steps at 11:00AM.
How do you buy foreclosures?
There are several methods for buying foreclosed properties. It is important to decide what phase of the foreclosure process you want to become involved in. Homes in foreclosure can usually be had for a reduced price compared to what they were paid for. Let's look at the three important times when one of these deals might be found.
The first phase is when a homeowner has begun missing payments or knows they will soon begin missing payments. The home in this phase is considered in pre-foreclosure. This would be the time for you to consider making an offer involving a short-sale (more later on short-sales).
The second time to buy a foreclosure is to be present on the county courthouse steps, after the property has been foreclosed on, and make your bid.
The third option is to find a property that has already been foreclosed on and no one purchased at the county auction, this is considered a bank "real estate owned" (REO) property or government own HUD property.
In the previous paragraph several different methods for buying a foreclosed property were discussed, let's take a closer look at some of those options. A short-sale is a negotiated settlement between a buyer and a lender. A short-sale can be performed until the time the final judgment is passed and the mortgagor no longer owns the home. Often lenders will consider a short-sale for less than the value of the outstanding note because it will actually save them money from filing a lawsuit and the entire process that goes with foreclosing on a property. Another major reason this option has appeal to a lender is simple, they are in the business of lending money, not owning and repossessing property. This option also may appeal to the desperate homeowner as it may some negative effect on their credit, but will appear as a settled debt instead of a foreclosure. Finding this kind of property may be hard, but they are out there, especially in the current environment.
Buying Foreclosures at Auction
Purchasing a foreclosed homes on the county courthouse steps can be another successful method for getting property at a bargain basement price. The party foreclosing on the property is required in Florida to publish advertisements weekly for three consecutive weeks prior to the auction (the owner has until the moment of the auction to redeem the property by paying the outstanding debt).
If a property gets to this step the starting bid will likely be a little inflated from the amount owed on the loan to help defray the costs incurred by the lender in foreclosing.
When you make a winning bid it is required to have 5% of the bid on hand, with the balance due by the end of the day. At this point you will be issued a Certificate of Sale and the property will be deeded over after period of time allotted for the court to insure there was no collusion in the sale, this period is typically ten days. If the property has made it past the courthouse steps and is now in the hands of the bank or government it should be easiest to find. Many lenders have a list of REOs on their website, or have given them as listing to realtors. The same is true for government HUD foreclosures.
Foreclosure Due Diligence
When buying a foreclosed property it is important to be diligent in researching the property you are interested. You need to know as much about a prospective property as possible. While you may be getting the property at a discounted price, it is imperative to inspect for other liens, including taxes, the condition of the house, and search for other items that may costs you, the buyer, upon purchase. Many of the homes in the foreclosure process are in very poor condition with fixtures and appliances removed.
A real estate broker, or realtor can be a real asset when buying foreclosure property. We can often provide access to foreclosure listings from the Daytona Beach MLS Listings and we have extensive knowledge of the area and market conditions to guide you toward making the right decision that doesn't turn out to hurt you later. I have also handled short-sale negotiations and I know how to approach owners looking to do a short-sale.
It is wise to consider foreclosed homes as one of your options. Daytona new homes are often attractive, with home builders offering significant discounts to move high inventories. So builders have actually started leasing new homes to cover carrying costs. There are also homes for sale in Daytona Beach, Ormond Beach, South Daytona and other local communities where sellers are very motivated. Look at all the options before plunging into this crazy market.
The are manyDaytona Beach Foreclosed Homes on the market. Our area has been hit hard from the speculation that was at fever pace prior to the downturn. There are plenty of opportunities, but pitfalls as well. If you are ready to make your foray into the foreclosure marketplace, feel free to contact me at 386-566-7503 for any questions or more information regarding Daytona Beach Florida real estate foreclosures!