In Lexington, Kentucky, most of the foreclosure homes are foreclosed through the judicial process. Including the pre-foreclosure period, it takes about 6 months to foreclose a property. However, one of the exemptions is when the property has been abandoned. If this is the case, the court automatically rules in favor of the lender, allowing them to take possession of the property.
In Kentucky, the court doesn't permit the power of sale clause to be included in the mortgage agreements. This is one of the reasons that makes it difficult to settle foreclosure cases. To pay the mortgage amount, the lender can file a complaint (Lis Pendens) against the borrower.
Before buying a foreclosed home, there are some things you have to be extra careful about. Be wary of the home's recent history before you buy a foreclosed home. A home may look like a bargain from the outside and the media and advertising can make it look and sound like it's the ultimate deal. There is no seller's disclosure to advice you about the repairs or problems made from the property's previous owners.
Do as much research as you can about the foreclosed house. Remember that the things you don't know about the property may be perilous to you and your family. Once a property is foreclosed, they can be resold without any documentation of its history. If one of the properties happen to have a meth lab, walking in one of them could be risky and may cause serious health issues.
The great thing in Kentucky is that now, it is a Class D felony to rent, lease, or sell a property if the owner has not provided a written notice saying that the property has been previously contaminated by methamphetamine and hasn't been cleaned by a certified contractor. This kind of violation could cost you a fine of up to $25,000 and/or one to five years imprisonment.
Another issue in foreclosed homes is the mold. Check the basement, its walls may be covered with black mold. The hidden damages you have to watch out for would be liens, water damages, and more. Before you buy, it pays to do a lot of research. You may encounter a bargain that may not really be a bargain in the long run.
Be wise in choosing the location of the property that you want to buy. Be sure that it is structurally sound and it doesn't have environmental problems. Choose homes that are far from freeways, apartment complexes, internet highways, behind shopping centers, commercial zones, and industrial parks.
Once the court declares the auction, it becomes easy to buy foreclosure properties in Lexington. After the sale, the borrower has the right to redeem the property. This redemption period lasts up to one year after the sale. Above the loan amount, the borrower is also required to pay an 8% interest to redeem the property. This is where knowledge on the foreclosure process comes in handy. You would need a lot of patience when purchasing property that has a long redemption period.