Austin Real Estate Blog

Every industry has its own jargon. The real estate market is no exception, which often leaves home buyers and sellers in a state of confusion. This can be avoided and in the effort to assist in that goal, there will be a regular sequence of real estate definitions available. With such in mind a definition and understanding will aide in limiting or eliminating the confusion. This will allow any home buyer or seller to know what questions are best to ask the real estate agent about.

With the Term Foreclosure in the news almost daily, it is a good place to start. Foreclosure is defined: The legal approach taken by a lender which deprives a borrower of the property purchased through a loan arrangement. This is not a haphazard legal process. This legal approach is never started unless the borrower is grievously behind on their payments, and the property purchased maintains value. Typically foreclosure ends with a forced sale of the mortgaged property, either by public auction or by private arrangement through a real estate agent.

An option out is called a deed in lieu of foreclosure. The borrower signs the deed to the mortgage lender instead of following through a foreclosure procedure. This allows the borrower to avoid the paperwork being filed for the foreclosure. This saves the borrower the taxing issue of creating a public record of the foreclosure process. The debt itself will likely appear on credit reports, however because it is not going into court, it saves money, time, and public records of the foreclosure of the given property.