Helpful Facts And Advice In Dealing In Real Estate: From Redemption To Foreclosure
When you buy property at auction in a state that has redemption laws, you get a special deed or special title. Because the owner has a number of months in which they can repay the purchase price and redeem their property, it's called a defeasible title. That is, one that can be defeated, which means that you don't have clear title yet.
Securing Redemption Rights
Whenever you make a purchase such as this, you can always buy the redemption rights from the owner -making the title you hold clear, or in simpler terms: permanent. It's always a good idea to consult your real estate lawyer with regards to handling this type of case as the laws differ from state to state. If you're not careful, you can and will get screwed over.
Purchasing Property
Acquiring Property:A lot of hopeful homeowners, besides scouting out good property, usually start with getting a loan. A note is the borrowed money, say $200,000. When you use that note to purchase real estate, you are issued a mortgage or deed of trust -this is the security instrument. So when you're paying off your loan, it's called paying off your mortgage. If you, the owner and borrower can no longer pay for your mortgage, your property can be foreclosed -that is repossessed, confiscated, or taken as collateral. Or, depending on certain factors, the lender can see you in court.
The relationship between notes, deeds, mortgages, foreclosures, borrowers, etc:
In a Deed of Trust state, there are three parties involved in the foreclosure process:
Trustor = Borrower
Beneficiary: Whoever lends the money (aka mortgagee)
Trustee = Party handling the transaction
These two are separate and different documents, yet serve a single purpose: ensuring that the loan is paid in full, and should the Trustor fail to do so, securing the perused property as collateral.
In the event of a foreclosure, there are usually 2 major ways to handle it:
Short Sale
Equity Split
There may also be another option, a "subject to" transaction for more expensive properties. - 23310
Securing Redemption Rights
Whenever you make a purchase such as this, you can always buy the redemption rights from the owner -making the title you hold clear, or in simpler terms: permanent. It's always a good idea to consult your real estate lawyer with regards to handling this type of case as the laws differ from state to state. If you're not careful, you can and will get screwed over.
Purchasing Property
Acquiring Property:A lot of hopeful homeowners, besides scouting out good property, usually start with getting a loan. A note is the borrowed money, say $200,000. When you use that note to purchase real estate, you are issued a mortgage or deed of trust -this is the security instrument. So when you're paying off your loan, it's called paying off your mortgage. If you, the owner and borrower can no longer pay for your mortgage, your property can be foreclosed -that is repossessed, confiscated, or taken as collateral. Or, depending on certain factors, the lender can see you in court.
The relationship between notes, deeds, mortgages, foreclosures, borrowers, etc:
In a Deed of Trust state, there are three parties involved in the foreclosure process:
Trustor = Borrower
Beneficiary: Whoever lends the money (aka mortgagee)
Trustee = Party handling the transaction
These two are separate and different documents, yet serve a single purpose: ensuring that the loan is paid in full, and should the Trustor fail to do so, securing the perused property as collateral.
In the event of a foreclosure, there are usually 2 major ways to handle it:
Short Sale
Equity Split
There may also be another option, a "subject to" transaction for more expensive properties. - 23310
About the Author:
Want to know more about real estate? Log on to Don Burnham's website http://www.weknowthewayback.com and know everything from redemptions and foreclosure all under one roof.
posted by Mr. Forex at
2:01 AM
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