Purchasing a home is already a complicated and stressful process. Buying a foreclosure property is even more complicated and comes with added risk. If you have very little or no experience in the foreclosure market, it is extremely important that you consult with a Calgary Real Estate Agent who has extensive experience and knowledge about the foreclosure market and processes. This will help mitigate any risks and will ensure a smooth, headache-free transaction. Foreclosure real estate can be an advantageous way for real estate investors to access off-market deals at discounted prices. Although foreclosures seem like a steal of a deal on paper, without the right knowledge and due diligence, the transaction may not go in your favour, costing you extra, unnecessary amounts of money and stress. Hiring an experienced real estate agent who always has your best interest in mind will help you avoid any pitfalls you may encounter.
What Is A Foreclosure?
A foreclosure on a property occurs when the homeowner is unable to meet their mortgage payments, therefore forfeiting the rights to their property. Judicial foreclosure is a process banks use to foreclose on mortgages in Alberta, British Columbia, Quebec, Manitoba, Saskatchewan, and Nova Scotia. During a judicial foreclosure, the courts control the foreclosure processes. A judicial sale can take a significant amount of time and money because of the lengthy court case and legal fees involved. The homeowner (borrower) will be served with a “Statement of Claim for Debt and Possession” and will be given 20 days to file a “Statement of Defence” in response. If the borrower does not file a defence or if they lose their case, the lender (the bank) will be granted permission to sell the home. The lender can sell the property through a real estate agent or a real estate auction. A large portion of the return they see from reselling the property will go towards the missed mortgage payments and legal fees involved.
What Is A Foreclosure Real Estate Agent?
A foreclosure specialist is a real estate professional who specializes in working with foreclosure properties. Since the foreclosure process can be lengthy and complicated, many investors choose to work with a real estate agent to help facilitate the foreclosure process and mitigate risk. An experienced Calgary foreclosure Realtor® will handle the responsibilities of:
- Communicating with the lender
- Negotiate selling terms with the lender
- Help review or request appraisals and inspections
- Review the sale of foreclosure documents to verify any liens that may impact the sale of the property
- Understand provincial laws for foreclosure processes
Working With A Realtor When Purchasing A Foreclosure In Calgary
There is no special training involved for a Realtor® to become a foreclosure expert. Understanding of the ins and outs of the foreclosure market is built through years of experience. Not all Realtors® have this experience, so it is extremely important that you choose a trusted, reputable Calgary real estate agent who has proven experience in foreclosures. A Realtor® who has this experience will understand how to effectively communicate with the bank, know the protocols for closing, and can help coordinate essential aspects of the transaction while making sure you are making a smart purchase.
The Mel Star Team: Calgary’s Top Foreclosure Experts
Investing in a foreclosed property offers some unique and great opportunities. However, the process is much different than a traditional home sale and can take longer costing you large amounts of money. Hiring an experienced Calgary Realtor® will help you avoid these risks so you can focus on more important aspects of the sale such as moving or preparing for renovations. They will be able to share a wealth of knowledge with you about the foreclosure market that you will be able to use to your advantage and they will point out any red flags or major risks involved in the transaction.
The Mel Star Team has over 40 years of experience in Canada’s real estate industry. We know the stress and uncertainty that can come when buying a foreclosed home. We mitigate the risks by offering an all-inclusive, one-stop concierge service for all your home buying needs.
To find out more, contact us at (403) 861-9944 or fill in our contact form.
FAQ's
Q: What is the power of sale?
A: With a power of sale, the lender (the bank) must sell the property for the highest price possible to cover any legal costs associated with the foreclosure process as well as pay off the missed mortgage payments from the homeowner. Once the sale is complete and all debts are paid off, the remaining balance will go to the borrower (homeowner).
Q: Will the bank pay for an inspection on the foreclosed property?
A: No, the bank will not pay for any inspection. Inspecting the foreclosed property must be organized and paid for by you. This is an expense you must take as a potential buyer to ensure the property you are interested in does not have significant unexpected damages.
Q: Can you finance a foreclosed property?
A: Yes, you can. However, banks do find all-cash offers more attractive.
CONTACT US
We are here to help and we'd love to hear from you. Call us at 1-403-861-9944 and we will be in touch shortly!