Foreclosures
Have you thought about buying a foreclosure or doing a short-sale? Why not let ShopProp do the work for you?

1. Gathering the Data - ShopProp gathers all of the trustee sale data in Snohomish and King County. We then scrub and call all the trustees sites for opening bids (this is the minimum price the bank is willing to take for the property and it usually comes a few days before auction). We post all this information into our software.
2. Finding the property - Once you have access to the software you can locate properties you are interested in or you can give one of our agents your criteria and we will send you the properties that match your criteria.
3. Financing - All foreclosures are bought with cash. You need to have a cashier’s check for the entire amount of the property at auction. If you don’t have access to the entire amount on hand ShopProp will point you to a company that provides short term funding. The rates are higher than normal loans, but the idea is to refinance as quickly as possible.
4. Inspection - ShopProp drives the properties and when we have access will inspect the inside as well. This is not a formal inspection and you have the risk that something is wrong with the property that could not be detected by a visual inspection. All foreclosure are bought “as is”.
5. CMA - ShopProp will provide you with what we believe the current market value of the property is. We try to target properties that are 70-75 cents on the dollar.
6. Bidding at the auction - ShopProp will bid or help you bid at the auction. We will help you or fill out the paperwork for you that is required at auction.
7. Securing the property - You will need to go to the property and if it is vacant change the locks. If it is not vacant you will need to notify the occupants.
8. Get insurance - You will need to obtain an insurance rider on the property. ShopProp can point you in the right direction.
9. Cleaning and fixing up the property - If needed you will want to clean and fix up the property so that it is more marketable.
10. Listing you property - You can relist and sell your property with ShopProp for our normal $1495 commission.

ShopProp charges 2% when you purchase the property at auction.

What is a Foreclosure?
A foreclosure allows a lender or beneficiary to recover the amount owed on a defaulted loan through the public auction of a property.

Foreclosure can end in one of the following ways:

• The borrower reinstates the loan by paying the defaulted amount during the pre-foreclosure period.
• The borrower sells the property to a third party during the pre-foreclosure period; allowing the borrower to pay off the entire loan amount and avoid having a foreclosure on their credit history.
• A third party buys the property at the foreclosure auction.
• A third party buys the property at a public auction.
• The lender or beneficiary takes ownership of the property at the foreclosure auction.

Steps to Foreclosure
During the foreclosure period various actions must occur before the property can be sold at auction. At any point in the process a foreclosure can be stopped or the sale date can be postponed.

The foreclosure time line can be broken into four stages:

• Pre-Foreclosure Period (Notice of Default): This is the time to research the property, determine property valuation, and possibly contact the owner to negotiate a pre-foreclosure sale.
• Foreclosure Period (Notice of Trustee Sale): The auction day is scheduled, but is frequently postponed due to:  
  
  • Bankruptcy
  • Title disputes
  • Debt disputes
  • Delays can be hours, days, or weeks, so it is important to track the property status.
• Auction Day: It is important to do proper research prior to auction day. Public auctions are where the property is sold "as-is" on the court house steps. Buyers usually must pay in full at the time of purchase, so you must have "cash in hand" or arranged special foreclosure funding.
• Post Auction: Properties are owned with a free and clear title by the winning bidder. There can be some exceptions if there are other judgments against the owner of the property. We do research this as best we can, but when you deal with foreclosure there are risk like these associated with them.

ShopProp will charge 2% to help you through this process.

Short-sales

1. Search our data base for properties you are interested in and then drive by to eliminate potential problem properties.
2. When you find a property you may be interested in, give us a call and we will provide you with additional research, potential liens on the property, whether it is a first or second foreclosure, CMA on the property and what it means to you when doing a short-sale.
3. Hopefully through negotiations we can work out an option that works for everyone.
4. When your property does close you can list with ShopProp for $1495 plus SOC.

When we represent the seller ShopProp charges 3% (this is paid by the bank) for this service when the property closes. If we are representing the buyer our normal commission structure will apply.

 

What is a Short-Sale?

A short-sale is simply negotiating with the home owner's current lender(s) to accept an amount that is less than they are owed. These properties are generally in foreclosure or the owner needs to sell their property. ShopProp will help you negotiate the short-sale and put together the short-sale package for you which includes:

• A letter of authorization (LOA) from the seller authorizing their lender to discuss the loan with us on your behalf.
• A fully executed purchase and sale agreement contingent upon the lenders approval of the short sale.
• An estimated HUD-1 settlement statement showing an accurate statement of costs and a net-payoff to the lender.
• A hardship letter from the seller accurately describing the reasons why they are in foreclosure and why they are not able to make the mortgage payment in the future.
• A financial declaration spreadsheet from the seller itemizing their monthly income and expenses.
• 3-6 months of seller bank statements.
• Two years of seller's tax returns.
• A property condition and repair estimate.
• A Broker’s Price Opinion (BPO)-comparative market analysis

Remember a lot of this information needs to be provided by the seller, which can be a difficult and sometimes an impossible task. Also, Lenders want as clean an offer as possible so you do not want to add a lot of contingencies or other subject-to's.

ShopProp charges 3% for this service and it is paid by the lender (your mortgage company) only when the transaction is closed.

Free foreclosure search