Foreclosures Help Information

Posts Tagged ‘Foreclosure Auction’

I live in Orlando, Florida and the housing market is bad. There are foreclosures auctions 3 times a week at the court house. I know that in order to buy foreclosed homes, you must already have a certified check from a bank. But, if I find one I want, do I need a appraisal or anything else required by the bank? Some houses are selling at 50% of asking price before the actual auction so I should have no need for appraisal right? What are all the things that I need to do before buying a house? It would be my first home and primary residence.

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Michigan Tax Foreclosure Auction

In the third quarter of 2006, Detroit real estate suffered more foreclosures than other states; in fact, bank foreclosed on four times as many homes there as compared with the national average.

RealtyTrac is an online foreclosure resource, which documented that Detroit’s mortgage failures were up 43% since 2005.  Some contributing factors have been the steadily rising home prices, as well as the resetting of variable mortgage rates.

Two other cities suffering similar rates of foreclosures were Fort Lauderdale, FL and Denver, Colorado.

During the same time period, among metropolitan cities, Bethesda, Maryland, boasted the lowest foreclosure rate – about one in 5,500 homes, or roughly 1/68th of what was reported for Detroit.

Among cities with high foreclosure rates, only Indianapolis achieved any recovery during that same quarter, slowing just fewer than 3%.

Local dynamics of Detroit economics

The Detroit real estate landscape has been exacerbated by specific regional challenges, such as the local employment market.  Detroit foreclosures followed auto industry layoffs, which continue to be prevalent. 

In early 2007, Michigan’s unemployment rate was 7 percent, the highest in the country, as documented by the Bureau of Labor Statistics.  That rate of joblessness was began around 2003, when Ford made considerable cost cuts and eliminated jobs in its efforts to meet Japanese competition.

Loans carried by “solid” borrowers

Ironically, a higher percentage of Detroit area mortgages are prime loans, made to the most credit-worthy borrowers.  Nearly 80 percent of the loans originated in 2006 were “A paper,” a few points higher than the national average.

Even those homeowners in Detroit who are making timely mortgage payments are feeling the impact of the high foreclosure rate.  As neighbors’ loans default and Detroit REOs rise, prices quickly dropped 10 to 20 percent.  This kind of decline in value can leave homeowners upside down, owing more than the property is worth.

There is a type of “guilt by association.” A whole neighborhood is stigmatized when auction signs and bank foreclosures appear.  The good neighbor, who meets his payments and maintains his property, is nonetheless negatively impacted.

Even on Wildemere Street, an upscale Northwest Detroit neighborhood, there is some adversity.  The two-car garage, Tudor homes sell for twice the city’s median price, yet one fourth of the houses are vacant.  Many of the unoccupied properties display auction or foreclosure signs.

Taking profitable advantage of Detroit foreclosures

While the statistics regarding Detroit real estate seem a bit depressing, from an investor’s point of view, there may be ample opportunity.  The 30th Street area, a couple of miles from City Center, is nearly gutted, with the majority of row houses empty and dilapidated.  To some savvy investors, this bottomed out market phase can be the raw material for rebirth and even capital growth.

In Delray Beach, Florida, for example, builder Frank McKinney bought an entire block of similarly derelict homes on what is now called “Bankers Row.”  Many of the small bungalow style homes were vacant and unsecured.  McKinney applied his skills to renovate and beautify the block with municipal cooperation.  Buying the properties for back taxes, he created a new look to the block, which was then dual-zoned.  Today, Bankers Row is fully occupied by a mix of residential and commercial occupants.  Colorful paint schemes suggest Caribbean charm, and pretty awnings make the little structures seem just a bit larger, with a hint of whimsy.  Similar neighborhood uplifts followed the Bankers Row success story in Delray Beach, converting what were considered dangerous neighborhoods to communities.  Delray does not have an auto industry.  The major source of jobs is hospitality, mainly restaurant and bar services.  But in the case of that Florida city, perhaps the homes brought the people and the jobs.

Can Detroit be the next such revival?  With the severely discounted foreclosures and ample profitable opportunity, the answer may indeed be a resounding yes.

About the Author:

Urban Detroit Wholesalers is dedicated to upgrading the value of your Detroit real estate portfolio. Read our market analysis, current news, and pertinent case evaluations of Detroit investment properties.

Source - Foreclosure Homes for Sale in Detroit

Beginning Investor Seminar (Detroit, MI) - Tax Consequences of Foreclosures

King County Tax Foreclosure Auction

Gather around children for a tale of royal power. Far back in history the king owned everything. (Does that remind you of Donald Trump?). Occasionally the king would grant property to a duke. Property ownership meant wealth, so the king would demand that the duke pay yearly taxes. To this very day much of the money that supports government comes from property taxes, for you see children, government is still king.

If the property owner fails to pay the tax the county government places a lien on that property. Every year property tax liens are sold at auction to the highest bidder. If the property owner fails to satisfy that tax lien the new owner of the lien can begin foreclosure and acquire the property. That seldom happens, but it is possible. Usually the liens are redeemed (paid) before the time limit expires.

You've probably seen the TV infomercial extolling the benefits of buying property tax liens. It's true, property tax liens usually pay an above average rate of interest (it varies from state to state) and the lien is secured by some kind of real estate. Because of the infomercial and real estate seminars, tax lien investing has became very popular. There was a time in some counties when few people would show up at the property tax lien auction. These days the seminar gurus often arrive with bus loads of students ready to bid.

A good investment, yes, but there are some surprises for the uninformed. Because property tax sales occur each year, there may be liens on the same property, for different tax years held by different investors. Like this… Bill bought the 1980 lien; Hillary bought the 1981 lien and George was the successful bidder the next year when the 1982 liens were offered.

Here in Arizona the law is very clear that tax liens for different tax years held by different private parties have parity among themselves. So if the redemption period for Bill's 1980 tax lien had expired without being paid he could foreclose on the property, but his foreclosure would not wipeout the liens held by Hillary and George. Bill might have a right to the property, but he could not get clear title until he pays off Hillary and George.

If Hillary and George had been influenced by that infomercial and thought that they could scoop up ownership of property for the simple price of a tax lien, well they are more than a little disappointed.

Oh, there could be one more surprise. Sometimes the state owns tax liens. When the state government forecloses all other privately held property tax liens are turned into waste paper.

Property tax liens certainly can be a good investment if you always keep one fact one mind... You are the duke and the government is the king!

About the Author:

Mark Walters Author. Mark is a 3rd generation real estate investor, author and all around entrepreneur. You can get access to his Free videos by going to www.CashFlowInstitute.com and www.CreatingWealthClub.com

Article Source: ArticlesBase.com - The Good And Bad Of Property Tax Investing

King County WA Tax Deed Sale December 2006 Foreclosure section phone 206-296-4184.