The Clear House and Foreclosures

The current housing crisis has brought the once obscure home foreclosure to the national headlines. Foreclosed properties now make up a significant proportion of all home sales. In many parts of Southern California, foreclosed homes now account for over 50% of all homes sold. The Clear House benefits all parties involved in both standard and foreclosure real estate transactions.

There is a general cloud of mystery surrounding the existing condition of foreclosed properties. Home buyers are warned to approach these properties with caution, and rightly so. Home owners facing foreclosure are clearly in financial difficulty, and have most likely spent very little money maintaining the condition of their home. Beyond that, many stories circulate about distraught homeowners intentionally damaging the house they will soon be losing.

When a homeowner enters foreclosure, the ownership of the property is passed directly back to the lender (except in the rare case of a private 100% cash purchase at the initial public auction). The bank that owns the property then either lists the property for sale using a traditional agent, or puts the house up for a 2nd auction (different from the initial all cash auction). These properties are listed “AS-IS”, and potential home buyers have little chance to complete a proper home inspection. If they choose to make an offer on the property, or bid at auction, they are taking a gamble and will only be willing to pay well below market value. They may get a great deal, or they may get a money pit.

The accepted routine of selling or buying a home in unknown condition benefits NO ONE. This is the precise inefficiency The Clear House aims to correct. The Clear House will give banks the option to get a pre-sale inspection from a highly qualified inspector who was chosen by an independent third party (The Clear House), thus removing any conflicts of interest. They will then be able to publish the inspection report on our website for anyone to view, which in turn will give potential buyers ALL of the information and transparency that is currently non-existent.

This will result in the buyer paying a price that is closer to market value, but they will have the valuable assurance that they are not buying a financial disaster.

Home purchases are a zero-sum game -- an unfair gain by one party is an equally unfair loss by the other. With the current foreclosure sale process, the winner and loser is unknown, both sides are gambling. By using the simple Clear House process, the mystery and obscurity is removed, and is replaced with a transaction that is both transparent and fair to all parties involved.