Foreclosure Resource Center

Pre-Foreclosure
1
Search for a foreclosure. Get the address and owner contact details. There are several online foreclosure listing sites, like Foreclosure.com, Foreclosures.com and RealtyTrac.com. They allow you to filter your search by area, price or even number of bedrooms. You can also find foreclosure listings at county recorders’ or clerks’ offices. They are also advertised in newspapers and public places as part of the legal steps a lender must take to foreclose on a property.
2
Talk to the owners. Be tactful and try to build a rapport with them. They are going through a distressing situation and might not even know their home was featured in a public foreclosure listing. In the pre-foreclosure stage, homeowners have fallen behind on their mortgage payments and received a notice of default from the lender. From then, they have three months to make up for the default on the mortgage before the lender schedules a foreclosure sale.
3
Make an offer. If the owners cannot afford their mortgage, they might accept a low offer that covers their mortgage balance, in order to avoid a foreclosure. If your offer is for less than the mortgage balance the sale is considered a short sale. Lenders must approve a short sale before it can go ahead.
Foreclosure Auctions
1
Find out how the auction process works in your county. Talk to a seasoned real estate agent or a foreclosure lawyer. You can also ask your local county recorder’s or clerk’s office for information. In California, foreclosure sales are held on business days from 9 a.m. to 5 p.m. You are not allowed to view the property before bidding, anyone can bid, and the foreclosure can be postponed to another time and location by the trustee managing the sale. Some counties require sealed-envelope bids, others require you to bring your bid amount in cash or in cashier’s checks. So make sure your financing is arranged beforehand.
2
Attend the auction. The time and location will be on the foreclosure listing or on the advertisement from which you found out about the sale.
3
Make a bid. The highest bidder takes the property. In California there are two types of foreclosures: non-judicial and judicial. The non-judicial path is by far the most used. In non-judicial foreclosures the auction sale is final. However, with judicial foreclosure the previous owner has up to one year to redeem his property by paying the foreclosure sale plus interest and any additional expenses incurred by the lender.
Bank-Owned Properties
1
Search for REO properties. Lenders usually use real estate brokers to sell their properties. You can find a real estate broker online at REO Network (see Resource section), which represents over 8,000 brokers.
2
Look out for the price tag. REO properties are the easiest and safest foreclosures to buy, but you stand less chance of finding a bargain. Lenders usually price REOs at the market price or just below.
3
Make an offer. Start low. If the lender has a large inventory of REOs in its portfolio, you might find yourself on the right end of a bargain after all.
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Warning

If you buy at a foreclosure auction, you will be responsible for any property tax liens on the property. Research a foreclosure carefully before bidding.
References
SmartMoney: Buying a Foreclosed Home
Realty Trac: How To Buy Foreclosures
Foreclosure: How to Buy California Foreclosures