Nationwide, foreclosures have climbed closer to record levels as thousands of homeowners struggled to make their payments and began loosing their properties to foreclosure. Miami Beach real estate foreclosures have more than double this past year and we are starting to see more and more Miami Beach real estate auctions. There are a number of ways to take advantage of foreclosures, depending on the stage of foreclosure of the property. At first, when the homeowner defaults on their mortgage, they receive a notice of default from the lender and are given a chance to catch up on their past payments. If this is not possible, then the property reverts back to the lender and is then considered an REO or real estate owned property, as it is owned by the bank who had given the loan on the property.
In order to understand the foreclosure process, it is important to understand the laws of your state, as every state is different. Florida, for example, is a judicial foreclosure state, which means that foreclosures in Florida are completely controlled by the court. The lender is the plaintiff and sues to obtain an order to foreclose on the property as the mortgage note is the actual security instrument. The court determines the Florida foreclosure procedure and may or may not order the notice of sale to be published in the newspaper.
The sale of the property ends any equitable right of redemption, which is a right under state law of a defaulted borrower to redeem his or her property up to the date of the mortgage foreclosure sale by paying in full the outstanding mortgage debt. The court does have the right to extend the time for redemption, however this rarely happens. What usually happens is that there is a time period immediately following the sale when the court reviews the sale to determine that a fair price has been paid for the property. This is normally ten days and the right of redemption remains in effect until the court confirms that the sale was fair.
Here are some additional statistics that illustrate how Florida foreclosures are amongst the top in the nation. Bank owned properties or REO properties are up 156.23% from 2006. Miami-Dade County has also experienced some of the highest per capita foreclosure filings by larger counties with 51.7 filings per 1,000 households with a total of 40,170 filings. The state of Florida was also in the top 10 states in the number of filings in November, 2007 vs. the same time last year with 214,694 filings, up 140.32% from 2006. Pre-foreclosures are also among some of the highest in the country in Miami-Dade County.
Florida foreclosure filings are at their highest and we are seeing more and more home repossession and Miami Beach real estate auctions but with this come Miami Beach investment opportunities that were not there before.
Contributed by Calvin Sibley, GRI. Broker Associate at MLR Realty
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