Foreclosures happen when home owners can’t keep up with the payments and the lender who holds the mortgage is taking over the property to sell it to recover the amounts they are owned.
All foreclosures are sold “as is, where is”
The lender selling the foreclosed property will require an addendum to be signed that ensures the lender who initiated the foreclosure cannot be held responsible for any damage that occurs to the property between the time it is viewed and the time it is sold. In a typical property purchase the seller is responsible to pass the property over to the buyer in the same condition as they viewed it in.
Foreclosures have been popularized as a way to scoop up a property at a discount.
While it is true a foreclosure is a forced sale and the owners will ultimately have to accept a bid on the offer date, Canadian foreclosure rules require lenders to advertise their foreclosure properties on the public MLS system and to have a public hearing. This is in place to protect lenders and help ensure they will get fair market value.
The foreclosure process is very localized and may differ widely between jurisdictions.
In the Lower Mainland and Fraser Valley we would typically see foreclosure hearings at the Vancouver or New Westminster courts. The hearings are public and anyone may appear before the court to place a bid at the time of the hearing.
To have an offer considered at a foreclosure hearing it will must be presented by sealed bid (a sealed envelope containing the offer). T, the closing dates are will be determined by the court but the offer must be unconditional and must include a copy of the buyer’s deposit draft.
All the bids will are read aloud to the court room and the most suitable bid will be selected. Once the bids are called up there is no opportunity to make any changes, so it’s important to get everything right the first time.
Recently we are not seeing many foreclosures because the market has been on the rise giving would be foreclosure owners the opportunity to sell their property over and above what is owed before the lender takes them to collections.