Real Estate Glossary Vol. 2
- 28 July, 2020
- Industry Trends
If you are new to the real estate industry you can get confused with all the real estate terminology. Having an understanding…
Foreclosure is a term you will normally hear in association with mortgages. A foreclosure, in Ghana, can mean good or bad news, depending on the side of the story you are on. For people who are looking to buy a home, that’s good news. For anyone who is making a mortgage payment for a house for sale in Ghana, it is bad news.
A foreclosure is a financial instrument of debt collection where the lender attempts to recover the balance of a loan from a borrower who has stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan. – Wikipedia
So, basically, a foreclosure happens when a person buying a house fails to make the required mortgage payments for a house. Normally, the owner of the property who is selling it would pay off all debt or sell the property via a short sale to recoup some of the money. If all this fails, then the property may be put up for foreclosure.
A borrower may end up in foreclosure when that person defaults on the payment on their mortgage for a period of time. This period of time varies based on the type of agreement was signed between the lender and the borrower. However, in general, defaulting payments for between 6 months and 26 months.
When a property qualifies for foreclosure, it is required by law that prior notice is given of the foreclosure. An intent of foreclosure should be issued about 15 to 30 days prior to the auction date.
Anyone who would like to invest in the Ghanaian real estate market is likely to come across foreclosed homes and start asking questions about the benefits of buying a foreclosed home. There are a number of foreclosed homes in Ghana that are available to the general public for purchase. Foreclosed houses are normally auctioned and sold off to the highest bidder.
It is quite common to see foreclosed properties in Ghana that you can take advantage of and purchase. Buying a house in Ghana is possible through foreclosure. The good thing for the buyer is that the prices of these homes are sometimes slightly lower than the average market rate, thereby, saving buyers some money. Most foreclosed homes are sold for cash since the whole idea is to liquidate the assets. Payment must be made within a short period of time to complete the purchase of a foreclosed home.
A foreclosure is not the type of thing that you would wish on anyone but it is becoming a more common occurrence in Ghana. Though it may have negative implications for the mortgagee, it opens up interesting avenues for a prospective buyer who is on the lookout for new property acquisition. The implications of foreclosed property on the real estate market in Ghana can be argued but whatever the case may be, having knowledge about a situation determines the action that one will take in resolving it. If you are in search of property to buy in Ghana then you should visit the meqasa website for the best real estate deals in Ghana.