The Foreclosure procedure in California is an extremely logical but a potentially complicated process unless it is understood. Once understood, it can be a highly profitable area of real estate investment. The following explanation is not intended to be a complete explanation on the foreclosure process but rather a brief overview and areas of potential involvement.

The process begins with the property owner. If payments are not made in a timely manner as outlined in the mortgage agreement, the beneficiary (lender) can begin the process of foreclosing on the property. At some point, the lender (beneficiary) will instruct the Trustee to begin the foreclosure process through the recordation of a Notice of Default (NOD). After the ?Notice of Default? is filed, the property owner has three (3) months to cure the default by, paying all back payments plus penalties and foreclosure costs or, sell the property. For many owners, because of economic or personal considerations, the sale of their property is their only option.

After three months has elapsed from the filing of the NOD without action by the owner, the Trustee for the lender (beneficiary) will file a ?Notice of Trustee Sale? and advertise the property in accordance with California law. The sale will now be scheduled for Trustee's Sale at public auction. The owner has a minimum of twenty-one final days to sell the property or cure the default before it goes to auction once this NTS is filed.

Even though the property is in foreclosure, the owners are in total control of the property until just prior to the sale (auction) takes place. Many great deals have been made with these motivated sellers during these final days. In most cases, the owner will loose everything! It is always in the owner?s best interest to sell the property at any price if he cannot reinstate the loan himself. This will allow them to walk away with something and keep the foreclosure off their credit record.

At the Trustee's Sales, the property will be sold to the highest bidder. If no bidders are interested in the property, the ownership will "revert" to the Beneficiary (lender). Property can be purchased from such beneficiaries if the process is understood. In most cases the lender will turn the property over to a local agent for resale however there are ways to circumvent this process and purchase properties directly from lenders. The lenders can at various times, accumulate a huge number of such properties. These are considered non-performing assets and are referred to as Real Estate Owner (REOs)

Thus, you can buy foreclosure properties at each of the three stages: From the owner prior to the Trustee Sale, at the Trustee Sale, or from the beneficiary (lender) immediately following the sale. We have been actively involved in foreclosure opportunities for over 10 years and follow foreclosures of such properties on a daily basis.

For foreclosure information and listings, go to: RealtyTrac.com

If you think you would like to participate in this area of real estate investing, call us at (949) 366-2895.