1SG (Ret) Kucic Writes:  Hawaii Real Estate/Foreclosures and Short Sales

By: David Kucic RA
CRS, GRI, ABR, e-PRO, AHWD
FIRST SERGEANT, US ARMY (RET)
TROPIC LIGHTNING REAL ESTATE, OAHU, HAWAII

Everyone wants "a good deal" for any item that they purchase whether it is a new car, a new pair of shoes and of course, a HOME.

I receive numerous inquires from people that are exploring FORECLOSURES IN HAWAII so I decided to write this post and explain a few things about our Hawaii Real Estate Market, Foreclosures, Bank Owned or REO Properties, Pre-Foreclosures and Short Sales.

First, I want to define the terms that will be used here because they play a critical role in understanding what is going on.

•1.      FORECLOSURE (2 TYPES IN HAWAII)

•·        Judicial Foreclosure-This is when the lender requests that the court declares a borrower to be in default.  Once the court rules that the borrower is in default, the lender can proceed with the foreclosure process.  A commissioner will be assigned by the court to handle the auction of the property.

•·        Non-Judicial Foreclosure-When the lender deals directly with the borrower by placing notices on the house and advertising the sale of the property in local newspapers.  This can be done as long as there is a power of sale clause in the loan documents from when the borrower purchased the property.

•2.      SHORT SALES IN HAWAII  

•·        A Short Sale is when the borrower owes more money on the home then what the sale of the home is worth.  There are several reasons for Short Sales to include:  The owners bought when the fair market price was high and now the prices have come down.  The Sellers may also be in a Short Sale situation if they took out a home equity loan when the fair market value was higher and now they owe more than the home is worth when they combine their mortgage with the home equity loan.

•3.      REO PROPERTY HAWAII (BANK OWNED)  

•·       This could be one of the safest ways to purchase a distressed property.  When the property is bank owned, you may not have a risk of any liens, tenants to deal with or back taxes owed on the property.

•4.      PRE-FORECLOSURES IN HAWAII           

•·        At the pre-foreclosure time, the owners of the property have been distressed for a while.  They are falling behind on payments and are on the verge of going into foreclosure.  These homes are difficult for buyers to find because most of them are already listed for sale since the owners cannot afford to keep them any longer.  There are however instances where the owners have not listed the house for sale.  In a pre-foreclosure, the amount of the sale is greater than the balance of the mortgage otherwise it would fall into a different category.

Now you are armed and dangerous with the basic information about the different categories of distressed real estate in Hawaii to include:  Foreclosures in Hawaii, Short Sales in Hawaii, REO or Bank Owned Properties in Hawaii and Pre-Foreclosures in Hawaii.

Whatever choice you make, you will want to insure you have a professional Realtor on your side to represent you.  While you may not have this luxury with a foreclosure, a Realtor can assist you with the other purchases.

For more information on any of above, visit http://www.davidkucic.com/ , email or call Team Kucic.