can someone explain this/ bank foreclosure/ sheriff sale on house

[sooners04]

I've been looking into buying foreclosures like this but it seems there is a lot too it as the original owner can buy it back if they pay the money within a certain time frame and a lot of legal issues. But you can pick up houses cheap this way.

[B.E.N.]

I've been looking into buying foreclosures like this but it seems there is a lot too it as the original owner can buy it back if they pay the money within a certain time frame and a lot of legal issues. But you can pick up houses cheap this way.

And that would happen as many times as people win the lottery...because that is what it would take for most people to get it back.

5+ years in real estate...never once even heard of that happening. Not one story even.

[.45Caliber]

And that would happen as many times as people win the lottery...because that is what it would take for most people to get it back.

5+ years in real estate...never once even heard of that happening. Not one story even.

Ben,
Whats the purpose of the sheriff sale? I've been at them and the only people who buy them are the banks that lended the owners the money.

Bank lends deadbeat money. Deadbeat does not pay. Here comes sheriff sale and the same bank buys it back? Of course by now deadbeat owes more on it than whats it worth. Why even have the sheriff sale?

[B.E.N.]

Ben,
Whats the purpose of the sheriff sale? I've been at them and the only people who buy them are the banks that lended the owners the money.

Bank lends deadbeat money. Deadbeat does not pay. Here comes sheriff sale and the same bank buys it back? Of course by now deadbeat owes more on it than whats it worth. Why even have the sheriff sale?

Sherriff Sales are required by court order during the foreclosure process. As much as people bag America lately the law won't just let the bank come in and say get out because you have not paid the mortgage. They have a lien against the property and can force a sale with this lien (foreclosure). The court then orders the house auctioned at a public auction to the highest bidder. That bid is supposed to satisfy the lien in theory.

BUT...many times there is no equity in the property because the mortgage is for close to what the property is worth. Instead of taking a big loss the bank buy the houses and attempts to sell the house with a Realtor.

Banks aren't interested in owning that type of real estate. It is a hassle to hire a Realtor and have the house sit on the market but it beats the option of taking a huge lose on the mortgage.

This is why if you have sub par credit you get a higher interest rate. The bank is trying to justify the increased risk of lending to you.

That is pretty vanilla but you should the picture.

[B.E.N.]

If you are looking for a deal on a house try this HUD site. Some are foreclosed or in need of repair but you can get the for cheap and put some sweat equity in.

http://www.hud.gov/homes/homesforsale.cfm