The bending process #1

What's going on friends?

After several requests I start posting articles about the foreclosure process. Hope you enjoyed the articles on pre-foreclosure!

The foreclosure process varies greatly from country to country and the type of debt held by the lender, but the idea remains relatively similar.
Let's start from the beginning, who can take the house for you?
A question that can be seen in a preliminary examination is quite simple but in practice it is much more complicated.
The owner of the property knows and acknowledges that a lack of payment will enable the working bodies to encircle the property, so the process is simpler and faster. Another debtor (accounts, claims) will find it difficult to encumber the asset for repayment of the debt and will need extensive legal intervention to prove its claim on the property.

So the asset is foreclosed and offered for sale, what is the first step?
There are several options, I will refer to the most common in most countries.
After the seller receives the notices and does not respond, the first step in the transfer of ownership process is a tender in court. The tenders are published on the regional website and other designated sites and invite investors or buyers to submit an offer on the property.
The two main risks in working with properties from a tender are renovation and Teitel (Tabu) and I will explain,
For the most part, we as buyers will not be able to make doubt about the asset before the tender or sometimes even not to enter the property but to see it from the outside only. It is our responsibility to ensure the renovation as much as possible in order to minimize mistakes that will cost us money.
In addition there may be additional debts on the property beyond the lender debt, these debts we will have to deal after the purchase of the property in the tender.
In order to overcome the difficulty, preliminary Teitel tests should be performed for each property that you plan to bid on. This test will provide additional information about additional debts that may be in the property and will complete the required information.

It is important to know that many of the properties published on the district lists will not be offered for various reasons. Therefore, it is recommended for those who decide to approach the property auction in court to perform a check on several properties at the same time, these actions can cost time and money but will help the investor not to return empty-handed.

Next week, according to what is the price of the auction house? Are all assets going out for auction? What happens if an asset is not issued or not sold in a tender? What is REO and how can we buy assets from the risk-free receiver of the auction? And of course general tips on proper conduct with foreclosed properties.

Have a great week!