In the current sellers’ market, there are few foreclosures in Marin County–but there are some. Here is a snapshot taken today, May 2, 2018, when the housing market is very active:
- There are 4 properties for sale: three REO sales and one short sale. This is 0.6% of the 662 homes for sale.
- In the last year, there have been 27 foreclosure properties sold: 11 REOs, 8 Short Sales, and 8 Notices of Default. This was 0.9% of the 2,881 homes sold through the Marin MLS.
Sixteen foreclosed properties sold for less than $1M, nine from $1M to $2M, and two over $2M.
Missing a mortgage payment starts the foreclosure process:
- Ninety days or less after you miss a mortgage loan payment, you receive a Notice of Default from your lender. You have three months to correct the foreclosure by making back payments. You can also stop the process by filing for bankruptcy, applying for a loan modification, or selling the house and paying off the mortgage.
- After 180 days from the first missed payment, your lender can file a Notice of Trustee Sale, which means that they can auction off your house 20 days later. This timing is not automatic, and depends on the lender.
Other Important Terms in the Foreclosure Process
Pre-Forclosure. This is the time between missing the first loan payment and receiving a Notice of Default, usually 90 days. Many homeowners stop the foreclosure process in the first 90 days by making loan payments. Owners are free to sell their house at market rate anytime until the auction or the lender takes possession.
Auction. If the owner is more than 180 days in default, the lender may put a house up for auction, usually on the steps of the local court house. This is a difficult process for most buyers. You have to bid on a house without entering or inspecting it. Also, you have to buy the house with a certified check in the full amount at the time of the auction. You may find when you arrive at the courthouse that an auction is cancelled without cause.
REO. The bank has taken ownership of the property and will put it up for sale through a real estate broker.
Short Sale. The lender has agreed to let the foreclosed owner sell the house for less than is owed on the mortgage. Banks grant short sales if the seller has a hardship and there is not enough equity in the home to pay off the mortgage after paying costs of sale. There is a detailed application process for a short sale.
But I See on Zillow…
If you check on Zillow today, you may see dozens of foreclosures in Marin County. Only eight of these are “Foreclosures.” The rest are “Pre-Forclosures.” Most of these pre-forclosures will not become foreclosures. The homeowner has several options for stopping the pre-foreclosure during this 90 day period and retains the right to the home.
Who Sells Foreclosed Properties?
Most foreclosed properties are sold through local real estate brokers. Banks hire us to sell their REO homes. Occasionally, an owner will sell their home directly, but there is little motivation for doing this; the owner will not receive proceeds from the sale.
We Can Help
If you are interested on buying a foreclosed property, we can give you advice on the condition of the property. Foreclosed properties may not be well maintained. We can advise you obvious and hidden expenses. If a house is in pre-foreclosure, we can, in some cases, find out for you if the owner is interested in selling. Contact Madeline at (415) 515-9357 or email firstname.lastname@example.org.