Marketing property in the face of foreclosure is different from marketing property generally in several important ways. First, foreclosures are public. Judicial and non-judicial foreclosures are public events in the sense that the details, including the owner’s name, the property address, the amount due on the loan and so on, are public information. There are companies and individuals who make their living churning the distressed property market. Dealing with these people, usually representing themselves as “investors,” is something to consider before taking on the marketing of property in the face of foreclosure.
The distressed property crowd creates issues for real estate agents in a number of related ways. People trying to make money on distressed property can be pushy low-ballers who upset sellers, complicate your marketing and generally take up time. Not all of them are ethical. A few are crooks. On the listing side, having a good relationship with your seller will help you keep yourself and your seller out of the worst that the distressed property market has to offer.
Forewarned is very much forearmed when it comes to marketing distressed property. The first step is to gather information. The Internet can be a source of information on foreclosure problems. For instance, a good deal of information on mortgage foreclosure rescue scams can be found here. The Oregon Department of Consumer and Business Services publishes a booklet entitled: “Foreclosure You Can Avoid It.” Further, the Oregon Department of Justice has helpful information here. Finally, agents should make themselves aware of what is going on in the local foreclosure market. The foreclosure market fluctuates and varies from area to area. Local knowledge is a huge advantage when marketing property in the face of foreclosure.
Knowledge is the key to marketing property in the face of foreclosure because it can be used to control expectations. Expectations (whether those of the seller or the buyer) are controlled by timely disclosure. There are two types of disclosures involved. The first is the disclosures the agent makes to their own client for risk management purposes. The second is the disclosures made to the other side as a matter of legal duty. These two different disclosures are not well understood.
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