Foreclosures - Real Estate investment opportunities

Foreclosures happen when a debtor breaches an obligation of a security document (such as a mortgage, deeds, or trust). The lender will then foreclose the real estate property. Most of the time, the lender does not want to own the property but want to be repaid for the funds owed. This is why a foreclosed property can be particularly attractive to real estate investors.

The foreclosure process includes the opportunity for the debtor to remedy the situation and pay the lender. However, many debtors do not have the means to repay the lenders. They have effectively defaulted. A default is a nonperformance of a duty or obligation such as failure to make payments called. A real estate investor can then step in and help the homeowner while making profit from the situation. A real estate investor will have to understand why the real estate property went into foreclosure in the first place.

For example, if the homeowner is just short of cash and the situation is temporary, the real estate investor can help by taking an equity position in the real estate property.

• How a real estate investor can help the owner of a foreclosed property
• Foreclosures Steps