Buying From The Home Owner
More aggressive investors will often contact the owner of foreclosure properties to try to buy the property before the auction. This is sometimes very intrusive and many homeowners (already traumatized by the whole foreclosure experience) are very annoyed and angered by what they perceive as vulture-like tactics.
But in fact, many homeowners are looking to sell their foreclosure property. By avoiding the actual foreclosure, their credit report is slightly more improved. Although the lender may have lots of past due interest, late charges and attorney fees stacked on the price, there’s no law saying that you cannot negotiate that away.
Many mortgage lenders will drastically reduce any penalties and fees, in order to facilitate such a “distress” sale. Remember that the lender wants to unload non-performing loans because it looks awful during their annual audit.