There are multiple benefits to buying a foreclosed property. However, it is important to take into account some details so that you as buyer are 100% aware of how this type of process works.

What is a lien on a property?

A lien on a property is a withholding of court order that is made in order for said property to fulfill the function of correcting or paying a debt.

In other words, it is a statutory mandate, which orders to retain an asset (that it it cannot be sold, rented or used) until the amount owed by de owner of said assed is paid.

What happen to the property?

Although it may sound a bit strange to the conventional way of buying a property.

When a property is on a lien, there is a process given by law, which must be followed. The first thing is that a declaration of foreclose must be made. This is done through the passing of a judge´s sentence; as a result of some litigation in which the owner of the property is found. In general, they are processes at the request of creditors to which said debtor did not pay. And because of this, your estate must answer for your debts (including real estate).

Now, in order for one of these goods to be sold, an auction process must be done. These processes are external to the judicial process. In other words, you as buyer do not have to worry about any type of legal consequence; since the auctions are open to all public.

To know all the details of the properties that are auctioned, you must enter the page of the Boletín Judicial published in La Gaceta; which is the official newspaper of Costa Rica.

Benefits of buying a foreclosed property

It can benefit you as a buyer in many ways. Even one that a property of these can come at a much lower price that the original appraisal.

The auction processes are complex at the judicial level, because if no buyer obtains the property in the first one, two more auctions must be made at later dates. Generally, the auction price drops considerably for the other two options, which is in your best interest. Although generally the assets that are taken to auction seek to cover a specific debt; most of the time the prices of these properties include interest expenses owed by the owner.

Properties that are put up for auction generally do not sell on the first day. Then the financial entities, the debtor and the judge, must follow up the process, making the property cheaper to get a third part to buy it.

Take into consideration that you are oblivious to everything related to the judicial process. In fact, your purchase will probably be located in a bank account linked to the Judiciary. But the rest of the buying and selling process is the same as it would proceed with a common seller.