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Finding and Purchasing Connecticut Foreclosures

Foreclosures have had a strong presence on the real estate market since 2007, and they are, on average, 30 percent of all homes sold. Sold at a lower price than most homes on the market, foreclosures may be five to 40 percent lower. Purchasing a foreclosed property, however, is a risk, and each state has its own set of foreclosure laws. If you are looking for Connecticut foreclosures, here are some factors to consider in finding and buying properties.

There are multiple approaches you can take to finding foreclosures. Some of the more typical ways are through lis pendens (public records for pending suits), real estate magazines, online, and in newsletters. For first-time homebuyers looking for a deal or those unfamiliar with foreclosures, properties sold through a bank, which often works with agents, tend to be the safest. Bank-owned foreclosures have no taxes, liens, or tenants, and the bank may have already done an appraisal.

Another less-traditional approach to finding foreclosures is looking for properties not previously owned. As the decline of the real estate market has shown, the need for new properties has lessened, and homes and buildings built a few years ago, now unoccupied, may be on the market as foreclosures. In this case, the bank takes possession of construction loans and may list the property as a foreclosure.


In any case, research is necessary before you contact an agent or go to an auction. Prior to purchasing, find out if there are liens for unpaid property taxes. Additionally, research the neighborhood, particularly the typical values of homes in the area and non-foreclosure sale prices. Also familiarize yourself with state foreclosure laws and procedures.

Connecticut is a judicial foreclosure state, and the judge managing the foreclosure proceeding grants a “strict foreclosure” or “foreclosure by sale” on a property. Before going to court, the owner of the property, pre-foreclosure, sends a 60-day demand letter before filing for foreclosure. After this, the process starts and takes three to four months.

For strict foreclosure, no auction is held on the Connecticut property, and parties interested can redeem the home within a certain period of time. If no one claims the property by a certain period, or by a law day, the title of the home goes to the lender, who has 30 days to record a certificate of foreclosure.

Foreclosure by sale, however, involves an auction. The court determines that there is equity in the property and establishes the time and manner of sale. The sale of the property is then handled by a committee attorney. The owner, or borrower, can stop the foreclosure process at any time before sale to make the remainder of the mortgage payment. If the property is sold to a new party, the committee attorney petitions the court to approve the sale so that the title goes to the new owner.

No matter if Connecticut foreclosures are strict or by sale, homebuyers should consider some of these tips from CNN Money:

•Don’t get caught in a bidding contest, as this often brings the price of the foreclosed property up.
•Contact the lender directly about a property.
•Follow standard home buying procedures, such as pre-approval for a mortgage by the lender.
•Understand that improvements are inevitable, but the property may not be worth buying if it needs many repairs. As you are probably aware, the foreclosure process starts when the owner falls behind on payments, and because of this, the likelihood that the home needs work and repairs is greater, particularly if a property has been neglected for a year or more. Before purchasing, go to the property with a contractor to inspect the home.


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