Buying A Foreclosure
Buying a foreclosed property can be a good deal, however it is important as a buyer to be informed, educated and cautious. It is important that you have a REALTOR® experienced with foreclosures and buying and selling distressed properties.
In order to have your offer taken more seriously it is recommended that you become pre-qualified with a lender before engaging in any negotiations. Obtaining this financing information will also help you understand what you can afford, and help move the process along more quickly once you have found a property you would like to purchase.
The benefits of buying a foreclosure:
- You may be able to obtain a home below market value.
- With just a few repairs and updates you may be able to see appreciation in your homes value, maximizing your investment.
Some important things to consider when buying a foreclosure:
- Due to be offered at a reduced price, some foreclosures end up with multiple offers on the table, so you may face competition and bidding against other buyers.
- Some foreclosure are offered at a higher price due to lender looking to recoup what’s owed on the house.
- If purchasing at auction, you may have to pay cash and may not have time to inspect the home before purchase.
- Obtaining financing can sometimes be more difficult when trying to finance a distressed property.
- The home may need costly repairs.
- The home may have been vacant for a period of time, which can lead to maintenance issues. The home should be thoroughly inspected.
- Some foreclosed properties have liens against them, that must be satisfied. Your Realtor® can check the property records for these types of contingencies.