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Information on Government Foreclosures & Seized Property
Government owned homes seem to have a stigma when they come up in a conversation. Folks often think it must be in a bad neighborhood or falling apart. There always seems to be a story ready to be created with the government as the real estate owner. However, the majority of homes sold from the federal government are generally ordinary pieces of real estate at fairly good prices. To get one, there is a process and you need to work through a real estate agent. Background A government owned home is generally real property and real estate that the government effectively owns title on and wants to sell to private parties. The title is in the name of the federal government, usually a specific federal agency, and it can be effectively transferred via normal real estate sales transactions.
There are a lot of rumors and innuendo that get generated about government homes for sale, alluding to bad neighborhoods or homes in disrepair so bad that the government ended up with them. However, the truth of the matter tends to be different. There are government foreclosures that are indeed in disrepair or they are located in depressed neighborhoods. But there's a lot of private property that fits that description as well. The way to protect one's self, just as with private property for sale, is to research the home before committing to anything. There are some common patterns that land homes into government hands more often than others, however. The first usually has to do with buyers who default on federal government-backed mortgages. In doing so, the foreclosed home ends up becoming collateral and the property of the federal government agency that backed the home loan originally. The U.S. Department of Housing and Urban Development (HUD) is frequently the agency that gets involved in such matters. Seizures are another type, with tax seizures being more common than law enforcement seizures. With income tax and property tax, both federal and local governments can go after homes to settle tax debts that are not paid timely. Usually this approach occurs after a lengthy period of giving the taxpayer a chance to settle his or her bill first. However, once initiated, the government involved takes effective title of the house to resell it for tax recovery purposes. Any funds leftover from the sale and tax recovery balance are then given to the former property owner. Law enforcement seizures occur as a result of federal drug enforcement laws mainly. These laws, both at the federal and state level, allow law enforcement agencies to seize property used for the purposes of illegal drug trafficking. However, these agencies don't necessarily have a use for the property confiscated, so it generally gets sold to liquidate the value and fund further law enforcement activities with cash.