Last Friday I attended the Short Sale and Foreclosure Resource Designation continuing education class that is currently being offered by the Real Estate Buyers Agent Council of the National Association of REALTORS. The purpose of the class was to help educate the participants with the latest information and show how real estate agents can best serve as a resource for both sellers and buyers of distressed properties.
Each seller who will potentially be involved in a short sale has a somewhat unique situation and set of circumstances. My job is to help you understand what your options are.
First Things First – The Terminology
Let’s look at the terminology, words and acronyms used to describe the foreclosure process as they relate to distressed properties in the Atlanta Market:
• Foreclosure: The legal process by which a defaulted borrower is deprived of his or her interest in a mortgaged property
• Pre-Foreclosure: The period of time beginning with the initial mortgage default up to the time when the distressed property is sold
• NOD: Short for Notice of Default. This is the official notice from the lender notifying the borrower that they have defaulted on the mortgage. The NOD formally begins the foreclosure process.
• Reinstatement Period: The timeframe stipulated in the Notice of Default in which the borrower has to reinstate the loan by making required payments and bringing the account into good standing
• Short Sale: A short sale is a situation in which the seller (1) owes more on the loan than the sale of the property will likely produce and (2) is unable to bring funds to closing to satisfy the deficiency
• Notice of Sale: If, after receiving the Notice of Default, the borrower does not or is unable to reinstate the loan, a Notice of Sale is recorded. The Notice of Sale explains where and when the foreclosure sale will be held
• Foreclosure Sale: A foreclosure sale is when the property is auctioned off to the highest bidder. This is also referred to as a Sheriffs Auction, a Sheriff’s Sale or a Trustee’s Sale
• REO: The acronym for Real Estate Owned. REO is the status of the property when the foreclosure sale is unsuccessful and the ownership of the property is transferred involuntarily to the lender
The Foreclosure Process
Pre-Foreclosure
• The Borrower Misses Payments
• The Lender attempts to Contact the Borrower
• The Lender sends The Notice of Default (NOD)
• If the Borrower does not Reinstate the Loan within the required timeframe the Notice of Sale is Recorded
Foreclosure
• The Foreclosure Sale is conducted
REO
• If the foreclosure sale is unsuccessful, ownership in the property is transferred involuntarily to the lender and the property is now Real Estate Owned
How I Can Help
My goal is to be a resource for distressed homeowners in the Greater Atlanta Market by helping them understand what options are available. I can also guide them to Foreclosure Avoidance Counseling which in many cases is free. Due to Georgia being a Non-Judicial Foreclosure State, time is of the essence regarding working towards a solution in a short sale or pre-foreclosure situation. To be totally blunt, in the State of Georgia there is an express lane to the foreclosure sale. If you know of anyone who can use this service, please don’t hesitate to contact me.
Atlanta Short Sale and Foreclosure Information Part 2
Take a look at The Options Available
Atlanta Short Sale and Foreclosure Information Part 3
The Anatomy of a Short Sale
Atlanta Short Sale and Foreclosure Information Part 4
An Effective Short Sale Package
Atlanta Short Sale and Foreclosure Information Part 5
What Buyers Should Be Prepared For and The Role of a Short Sale Buyers Agent
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Thanks for the information. It’s good to learn well the terminology. Many people have doubts over the georgia foreclosures.