Is It Better to Pursue a Judicial Sale or a Bank-Owned Foreclosure?

Are you wondering whether it’s better to pursue a judicial sale or a bank-owned foreclosure? At Mel Sar, our team of realtors have sold hundreds of each type of home and are in the best position to provide you with all the advice you need.


A house will go into foreclosure when the homeowner is no longer able to pay the mortgage, whether due to a job loss, the state of the economy, or excessive debt. While this is unfortunate, it can present a unique opportunity for homebuyers who want to purchase a house at a great price. 

There are several benefits of buying a foreclosed home, including: 

  • Better opportunities for negotiation
  • Faster sales
  • Lower prices
  • Fewer title concerns

However, you should keep in mind that buying a foreclosed home is a little different than buying a standard property owned by a homeowner, which is why it is always best to work with an experienced realtor, as they can help ensure you get the best deal possible.


Our Calgary Realtors Can Help You Make the Right Decision When Buying a Foreclosed Home 

In today’s market, it can be a huge challenge to buy or sell a home. Luckily, our team of Calgary realtors can help! We have over 40 years of experience and are the #1 real estate team in Calgary’s RE/MAX Central office, so whether you want to sell your home or buy a foreclosure, we can help you take care of all the details so you can focus on what matters most: investing in your family’s future. 

Want to know more? 

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Judicial Sales vs Bank-Owned Foreclosures: Which Is Right for Me? 

Are you considering purchasing a foreclosed home? One of the most important things you can do before starting the process is to understand the difference between a foreclosure and a court-ordered sale (judicial sale). Often, working with a professional real estate agent who has extensive experience in such matters, will ensure that you get the best value for your money and avoid making any costly mistakes. 

Here are some of the main differences between a judicial sale and a bank foreclosure: 


Judicial Sale

A judicial foreclosure refers to a foreclosure that goes through the court system. If the court finds that the mortgage debt is in default, an auction can be scheduled for the sale of the property in order to acquire the funds to repay the lender. This differs from non-judicial foreclosures, which are processed without court intervention. 

Key Takeaways 

  • A judicial foreclosure is why foreclosure proceedings on a property take place through the court system.
  • This often occurs when the mortgage note lacks a power of sale clause, which would legally authorize the mortgage lender to sell the property if a default occurred.
  • The judicial foreclosure is often a long process, lasting several months or even years.
  • Proceeds from a judicial sale will first go towards satisfying the original mortgage.
  • If there is anything left over after satisfying any liens against the title, the borrower may sometimes receive the balance of the proceeds as well.
  • A court-ordered sale is buying the home ‘as is’. This is why it’s important to do an inspection prior to putting in your bid.

Remember, the process of buying a judicial foreclosure is very complex. That’s why it’s so important to have an experienced realtor by your side who understands the process and the different scenarios that may arise, giving you the best opportunity to buy this type of home. 


Bank-Owned Foreclosure 

A bank-owned or real-estate owned (REO) property is one that has reverted to the mortgage lender after the home fails to sell in a foreclosure auction. REOs are a significant part of the housing market and can be a great deal for buyers, but there are some things you need to know before investing in one. 

Key Takeaways 

  • REO properties are not automatically bargains. Some are discounted because of location or damage, while others might not sell at a discount at all. Make sure to get an independent appraisal to determine a home’s true market value.
  • Typically, REOs are generally sold ‘as is’ so you want a professional to inspect the home before you make the purchase.
  • In most cases, banks will clear the title before listing a home — but never assume this is the case. Always check for liens and outstanding taxes and make sure you do a full, insured title search before closing the deal.

Before buying a bank-owned foreclosed home, you should strongly consider working with a real estate broker who has the right experience to guide you throughout the entire process.


We Can Help You Find Your Dream Home

Our team of real estate experts has sold thousands of foreclosed properties. We fully understand the difference between judicial and bank-owned sales and can navigate you through the entire process and different situations that might arise, to ensure you have a higher chance of obtaining the home you want.

To find out more, contact us at (403) 284-6333 or fill in our online contact form.

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