Hawaii Real Estate Foreclosures

What Is a Foreclosure?

Foreclosures are properties that owners have defaulted on. The owner took out a loan to buy the property, but could not keep up the payments. After a few months of missed payments, the lender starts foreclosure proceedings. In this pre-foreclosure period, the owner can pay off the back payments or sell the property.

If neither happens, the real estate is sold at auction. Should the property not sell at auction, it reverts back to the lender and becomes a real estate owned (REO) property. With real estate that has a loan insured by one of several federal agencies, these agencies reimburse the lender. The agency now owns the property and sells it to the public as one of several Hawaii real estate foreclosures.

Why Buy Hawaii Real Estate Foreclosures?

What interests buyers and investors is that Hawaii real estate foreclosures can be bought at a discount. The owner is obviously having financial difficulties and would like to sell the property to recoup as much as possible of an investment. If the property has not sold at auction and has reverted to the lender, the lender wants to sell because it is not in the property management business.

Real estate investors may snap up properties at below market value. Today, Hawaii real estate is a seller's market, and buying property in Hawaii is getting more expensive every year. This situation makes Hawaii real estate foreclosures even more attractive to investors, who may be able to pick up Hawaii luxury homes at a bargain price.