How Do We Help People Selling A House In Foreclosure?

FORECLOSURE PROCESS Non-Judicial FORECLOSURE STATE

Investors are always on the look out for houses to buy at a discount.  People that have received a Notice of Default indicating the Foreclosure process has started, a lot of times are not sure where to turn.  Yes, as investors we want to find properties to buy that we can purchase at a discount, but we should also be there to help people when the help is needed.  I am in Utah which is a Non-Judicial Foreclosure State.  Some states are a Judicial Foreclosure State. In Utah, for example, a home owner needs to be 90 days late on their mortgage before the bank will issue a Notice of Default.  The Notice of Default gives the home owner 90 days notice that a Foreclosure Sale Date will be issued.  A Sale Date gives the homeowner at least 3 weeks notice of the impending sale.  So in Utah the Foreclosure process usually takes at least 3 month and 3 weeks to complete once the Notice of Default is issued.

MARKETING TO PEOPLE IN FORECLOSURE

Direct mail, door knocking, phone calls, web sites and other ways to market can all work when trying to contact someone in foreclosure.  In my opinion we should always help and show people how to keep their house if that is what they want.  If this is truly what you want to do, your marketing should reflect that.  I simply make sure in my marketing that we tell people we will help them if they want to keep their house in foreclosure or sell their house in foreclosure.  People that want to Stop Foreclosure and get to one of my marketing channels see that I can help them keep their house.   Many people are not sure if they can or want to keep their house when they first get their Notice of Default; we can be there to help.  

SOLUTIONS FOR PEOPLE IN FORECLOSURE

In my state I usually advise people they can bring the mortgage current, File a CH 13 bankruptcy or work with the bank on a modification or other bank remedy to keep their house in foreclosure.  Unless the person in foreclosure can borrow money from friends or family members to bring their mortgage current, this solution is not usually an option.  I think the next best solution is usually a CH 13 Bankruptcy because a BK typically has the highest rate of success for people that want to keep their house if the people in foreclosure can keep up on the BK payments.  Always disclose that the people should talk with an attorney.   A modification or forbearance may work, but a lot of times a person's mortgage payment can go up even with a modification.  And, modifications are a lot of work.  Get educated in these areas, so you can offer advice to help people.

Sometimes people need to sell their house that is in foreclosure.  I always advise people if I talk with them early enough in the process, to decide asap if they want to keep or sell their house.  The reason is that, if they start the sale process early enough and the house needs few repairs, they will get the most money by listing their house.  Remember in my area people have about 4 months to solve the Notice of Default, and it takes a couple of mounts to sell a house the traditional way if everything goes smoothly.  Always encourage people to start ASAP if they want to sell their house in foreclosure.    

Sometimes people need to sell their house in foreclosure to an investor.  Typically this is because they wait until it is too late to sell the traditional way or because the house needs a lot of repairs.  This is where a Professional House Buyer will come in and purchase a house a few days from foreclosure auction or buy a house that needs a lot of repairs.  Both reasons should allow you to buy at a discount, so you can profit.

ALWAYS HAVE A HELPING MINDSET

It doesn't matter if you market to foreclosures, probate or any other list of people, always go in with the mindset to help people.  And always follow through and do what you tell people you are going to do even if you won't end up buying their property.