Buying Foreclosures in Georgia in 2022 [Expert Guide]

Georgia is certainly an attractive market for real estate investors in 2022. Home to major metro areas such as Atlanta and Columbus, it’s been one of the fastest growing states over the last decade. What’s more, particularly in the Atlanta suburbs, we’ve seen real estate values skyrocket as a result of booming demand. 

As such, buying foreclosures in Georgia is a great avenue for investors looking to make big gains on their capital. 

What’s more, Georgia has favorable legal proceedings in regards to the state’s foreclosure procedure. Its non-judicial foreclosure process means that lenders can foreclose the property at a much quicker pace compared to other states. Furthermore, occupants do not have a redemption period in Georgia and should you need to ask them to vacate the property, dispossessory action is also usually granted in quick time.

So, how do you actually buy a foreclosure in Georgia? Read on to learn the process.   

The current state of the foreclosure market in Georgia 

The federal foreclosure moratorium that was enacted by the CDC in response to the pandemic artificially suppressed foreclosures across the country for a year and a half. With the Supreme Court putting an end to the moratorium at the end of August 2021, foreclosures have been gradually increasing, although are not yet at pre-pandemic levels.

In Georgia, that state had the twenty second highest foreclosure rate at the end of 2021. However, this rate may well rise throughout 2022, given that Atlanta, Georgia has one of the highest mortgage delinquency rates in the country. 

Pro tip: As a real estate investor considering foreclosures in Georgia, you want to start thinking about your financing options ahead of time. Many foreclosure auctions take cash payments from the highest bidder. What’s more, investors may also consider using private lenders in order to secure financing for their property - but this will depend on your exit strategy. What’s more, this will require pre-approval before the auction. 

How to buy a pre-foreclosure in Georgia

It’s usually the case that the best deals can be found during the pre-foreclosure stage. This is the time period between a homeowner receiving a notice of default (NOD) for missing several months of loan payments, to the home then being repossessed. Many homeowners in this situation are incentivized to sell quickly, in order to avoid foreclosure and recoup some equity.

However, given that Georgia is a non-judicial foreclosure state–which means auctions can happen without the need to go through the courts–homes can arrive at auction in as little as 60 days from the date of the homeowner receiving the NOD. This means that pre-foreclosure inventory in Georgia moves extremely fast, so if you’re serious about buying you’ll likely need quick access to funds, such as via a private money lender.   

In terms of finding homes in pre-foreclosure, there are plenty of intermediaries connecting sellers with investors. For example Foreclosure.com provides a national database of homes in pre-foreclosure, while there are plenty of local wholesalers in Georgia that can source pre-foreclosure homes in return for a fee. 

Pro tip: The Caveat Emptor (buyer beware) principle should be taken seriously when looking at foreclosures. You should research comparables and make sure to complete a title search. This will reveal to you if there are any underlying costs and outstanding liens. 

How to buy a foreclosure in Georgia at auction

Homes that aren’t sold during the pre-foreclosure period will then be foreclosed and sold at public auction. Under Georgia state law, the lender is required to publish a notice about the foreclosure in the county newspaper for four consecutive weeks before the foreclosure actually takes place. Then, a foreclosure will usually occur on the steps of the courthouse. 

Again, referring to Georgia law, foreclosure auctions must take place on the first Tuesday of every month between 10am and 4pm. The property will then go to the highest bidder, who will need to pay in cash, before receiving the title. 

Foreclosure auctions can provide great opportunities for investors, however, it’s vital that you complete due diligence in advance of the auction, such as checking for additional liens and encumbrances that the home may have. While it’s unlikely you’ll be able to view the inside of the home, taking a drive past it will reveal the external condition of the property and what the neighborhood is like.

If you’re unfamiliar with the Georgia neighborhood that the home is located in, then working with a local real estate agent can help ensure you choose a foreclosure with good profit potential. 

How to buy an REO foreclosure in Georgia

If a property fails to sell at auction, it then becomes the property of the bank and is referred to as a real estate owned (REO) foreclosure. Understandably, banks want to sell these foreclosures as quickly as possible to recoup their losses, so are often offered with sizable discounts. And there are a number of online marketplaces that facilitate REO foreclosure in Georgia, such as Zillow

However, while REO foreclosures can provide the biggest discounts, they also pose the largest risk to investors. Any home that is considered a good investment is likely to receive plenty of attention from investors at auction. So if a foreclosure fails to sell at auction and becomes a REO foreclosure, this indicates that there could be some serious issues with the home. 

In which case, it’s vital you complete thorough due diligence before considering buying a REO foreclosure, as well as consult local experts, such as realtors and contractors, to get their opinion on the home.

Securing funding for a foreclosure

When buying a foreclosure in Georgia (either during pre-foreclosure, at auction or in an REO sale), you will need quick access to finance to pay for the deal. Here at We Lend LLC, we provide private loans to investors throughout Georgia. 

Our simple 4-step process can approve and fund your purchase within 3 to 7 days, ideal for investors buying foreclosures at auction. What’s more, there’s no upfront fees, and no bank statements or tax returns are required. 

To find out more, speak to one of our advisors today.