iPreforeclosures

Description

Foreclosure Investment Glossary Abandonment A situation in which a homeowner leaves a home without any intention of returning. If there is a mortgage on the property a foreclosure will occur. Many times these are called “key tosses ”, where the keys to the house are left inside or mailed to the mortgage lender. Auction The process of selling a property the highest bidder. In the case of foreclosures, there may be starting price, which is the lowest amount the lender will accept. In an Absolute Auction of a foreclosure, there is no minimum price. Bill of Complaint The initial paperwork that is filed in many states to the foreclosure process. Compromise Sale A VA property sale in which the amount on the VA loan is greater than the home ’s sale price. The VA may cover the loss. Deed in Lieu of Foreclosure Instead of waiting until the lender forces the sale of a house in the foreclosure process, the borrower deeds the property to the lender. Deed of Trust A deed of trust is a regarded a three-party mortgage arrangement between the borrower, the lender and a trustee. If the borrower fails to pay his mortgage, the trustee is preauthorized by the borrower to sell the house and apply the sales proceeds to pay off what remains unpaid on the loan secured by the deed of trust of give the deed to the lender in exchange for cancellation of some or all of the borrower ’s debt. A legal term meaning to lose ownership as in the case of a foreclosure. Deficiency Money a borrower who has lost real estate in foreclosure still owes to the lender because the foreclosure sale failed to generate enough from the sale price of the property to pay off the loan. D ’oench, Duhme Doctrine A legal term that state that when FDIC takes over a lender, they may disallow almost any counterclaims by borrowers against the lenders they have taken over. This clears the way for them to assume all loans and enforce all foreclosures. Dutch Auction An auction, which begins at a starting price and is lowered until a purchase occurs. Entry and Possession A foreclosure method used in some states which the lender either peacefully or by court order takes possession of the property from the borrower. Execution Sale The sale of a foreclosed property by a sheriff pursuant to a court orders. Fix and Flip See Flipping and Hard Money. Flipping, House Flips The selling of a house quickly, usually at a profit. Often done with foreclosures. Forbearance Prior to foreclosing on a property, a lender may agree to accept lower payments than originally agreed upon or added missed payments to the end of loan to help a borrower avoid foreclosure. This is normally handled by the lender ’s Loss Mitigation Department. Hard Money Lenders for persons who cannot acquire funds through usual sources. Their interest rates are above the average. Some foreclosure investors who fix and flip acquire funds from these sources. Holder in Due Course This legal document holds that a person or entity that obtains a note without notice of any borrower defenses to its enforcement may enforce payment of that note in a court despite any borrower defense or other reason for not paying.

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