Home Rent to Own | Power of Sale/Foreclosure | Credit Management Have You Been Declined For Home Financing Or Facin | Page 10

WHAT DOES POWER OF SALE OR
FORECLOSURE MEAN?
• Strict foreclosure. This is when the lender asks the court for the deed to a
house in lieu of organising a court-ordered sale. Toward the end of the
whole process the lender will be in complete ownership of the title to the
house and is under no pressure to sell the deeds.
• REO foreclosure. A REO foreclosure is the name given to a property legally
owned by the bank that was given back to the lender after a failed action
during the foreclosure battles.
• Pre-foreclosure. This is when property owned by an individual that is going
to be forced to foreclose by the lender. This is likely to happen if the tenant
has fallen behind on their rent or mortgage payments. It also means that
the properties will be sold for less than they are worth on the market. Thus,
the seller will make staggering profits when buying the aforementioned
properties.
• Non-REO foreclosure. By definition, this is describing a property wherein the
foreclosure process was completed without any kind of problems. The
buyer will pay the full amount owed to the lender of the scenario, this will
include any legal costs, interest or mortgage balance.
• Non-Judicial foreclosure. This is a foreclosure that was not approved by the
courts, otherwise known as power of sale. These foreclosures are passed
through much more quickly than the other kinds. Instead of a few months
for the family to sort their affairs and find a new house or living situation,
tenants are only given a few weeks.