Understanding the Foreclosure process:

I am not going to bore you with definitions here.You probably already know if your state uses Mortgages or a Trust deed as the legal instrument to secure a lien on a property. Across the US, states are about split in two. If in doubt call your local title company.  In a nutshell, state law governs the foreclosure process for either document.You will want to get a copy of your state’s real estate law from the Department of Real Estate. Read for yourself the laws and rights of the parties governing the foreclosure process. We are only talking a few pages here, not the whole document. Copies
typically cost just a few bucks,and are excellent to refer to when you have questions on any real estate matter. You want to memorize the timeline, and the legal process of a property in foreclosure, and the rights of the various parties.You want to know if, and when a loan can be cured, and what happens if a borrower files bankruptcy, or is in the military on active duty. How many days from a notice of trustee’s sale to the actual sale
date?

Certain situations affect the foreclosure process. The more familiar you are with the legal process, the more equipped you are to capitalize on any opportunity that may open up. Also getting information straight from your state's rules and regulations rather than through the translation of a
real estate agent or lender,is wise.Real estate law is constantly evolving, and your agent may not be aware of small changes.I have found what is possible legally by statute,and what is customary,are not always the same thing. You want to be the expert. After all,this is your business.
It is well worth the half-hour of study time. Once you are familiar with the legal process, it will become more evident to you what approach you will
want to pursue foreclosures.As you become more educated, more of these open up for you.You can approach your investing in one of three ways.

They are as follows:

1.Before the Auction:
Learning to find pre-foreclosures and purchasing the property before the sale, i.e.:Short sales.

2.At the Auction:
Borrowers have defaulted,and lender seeks to recapture loss at the sale.

3.After the Auction:
Lenders and government agencies sell from their inventories.Known as REO ’s or Bank Owned property. Each of these 3 areas of foreclosure require a different focus or expertise.A pre-foreclosure may have you working directly with a homeowner with a lease option strategy,at or near market value.This is a situation where you may be able to acquire a property without bank financing. Whereas an offer to a bank or lending institution most
likely requires you to work with an agent,and a lender of some sort to cash out the bank.