If you are looking to purchase a foreclosure in North Carolina please watch the video below and then give me a call or visit my master page on foreclosures. Myself or someone on my team will be able to assist you in this complicated process. We have helped people buy foreclosures in Chatham County and Wake County and from Pittsboro to Chapell Hill and Raleigh, Cary and everywhere in between.
The foreclosure buying process for property located in North Carolina
Foreclosed properties, also referred to as Real Estate Owned (REO) properties, can be much more challenging that they may seem at first. What appears to be an abandoned home that now belongs to a bank, who would ideally like to sell it in order to make money, is actually a complex and complicated entity that will prove many legal and financial hoops to jump through for any one interested in purchasing it.
One of the first surprises that a buyer is likely to run into is how long the process can take. Occasionally a potential buyer will learn of a house that in the very early stages of a foreclosure, and eagerly approaches a real estate agent with the hopes of being able to acquire the home at a discounted rate.
Unfortunately, the foreclosure process take a long time, and the buyer is likely going to be waiting for as long as a year and a half in some cases. First, the current owner will be given several notices and warning from the bank. After a few months, there will be a foreclosure hearing, where the court makes a ruling, and the bank receives ownership of the house. Once the title is secured, the bank needs to then needs to set the home up within it’s REO department to begin the selling process. As any one who’s ever dealt with a financial institution knows, they don’t move very quickly, and may take another several months to make the transition.
There is quite a lot of research needed on behalf of a buyer looking to purchase a foreclosed home. Even the mortgage application process is different, and more restrictive than a normal home purchase. Banks are very hesitant to finance a home that’s been foreclosed, because, statistically speaking, it is likely to be foreclosed on again. Most foreclosed homes will require either a cash buyer, or a significant amount of collateral in the form of a home equity line of credit.
A lot of glamour and attention has been put on the foreclosure market in the last decade, as the number of foreclosed homes available on the market between 2008-2010 had never before been seen. While they are still available today, the numbers have dropped quite a bit. Banks are hesitant to sell foreclosed home as soon as they are required, as they don’t want to flood the market and devalue the properties. This creates a limited supply of available homes on the market, raising the price for anyone looking to purchase.