What is foreclosure in simple words?
Foreclosure is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan..
What is the meaning of the word foreclosure?
verb (used with object), fore·closed, fore·clos·ing. Law. to deprive (a mortgagor or pledgor) of the right to redeem his or her property, especially on failure to make payment on a mortgage when due, ownership of property then passing to the mortgagee. to take away the right to redeem (a mortgage or pledge).
What is the difference between foreclosure and foreclosed?
A foreclosed house means it has gone through the foreclosure process, and the seller did not redeem the house, and the bank has taken over the possession of the house. The main difference is that the bank will want to make the sale final at the closing. … They want you to have no recourse after the closing.
Is it a good idea to buy a home in foreclosure?
Buying a foreclosed home can be a good idea if you have the financial cushion to absorb any potential problems. If you aren’t worried about there being potential issues or the cost to repair them, then buying a foreclosed property is likely a worthwhile investment for you.
What are the disadvantages of buying a foreclosed home?
Disadvantages:Auction purchase price must be paid in cash on the same day as the auction — no mortgage is usually allowed.No inspections allowed; as-is sale.Buyer may take property and owe other liens, back taxes and mortgages. … Bank cannot provide disclosures as to property history/condition issues.More items…
Is buying a foreclosed home hard?
A foreclosed home is one that’s usually owned by a bank or lender. … Yes, buying a foreclosed home does require a few extra steps and some additional planning. But the process isn’t overly complicated, and buying the right foreclosed property can get you a home at a bargain price.