Buying real estate through foreclosure will save you money. They say
that it is a buyer�s market out there. But what if you don�t have a lot
of disposable cash to put a down payment on a house? Are you reduced to
renting for the rest of your life? No. There are plenty of alternatives
for people who need a hand securing their own home. One way is to look
into buying a piece of property that has gone through repossession
proceedings and now now is owned by the bank.
Before you get started with purchasing a foreclosed property, you need
to understand some basic foreclosure information. According to
Investopedia, repossession of a home, is defined as �a situation in
which a homeowner is unable to make principal and/or interest payments
on his or her mortgage, so the lender, be it a bank or building society,
can seize and sell the property as stipulated in the terms of the
mortgage contract�. With our economy struggling the way it is, this is
becoming a reality for more and more people. For a homeowner, this is a
pretty scary word. But sometimes it can actually be a blessing in
disguise
Finding real estate that is in foreclosure is the first step to getting
a good deal on your next home purchase. Check the classified section of
your local newspapers for listings, and sheriff�s auctions. You may also
contact a local real estate agent who may know of property that will be
going into default status. It is also recommended that you contact
government agencies, such as the VA and HUD, as well as banks and other
lenders to see if they have any listings you may be interested in.
The auction buying of foreclosed properties is good way of acquiring
money. If you do not understand how to buy and sell foreclosed property
it could be one of the easiest ways of losing money. In foreclosed
properties, there is the difference between the highly discounted price
and the estimated value at which it can be sold. The important matter
here is that it is not necessary that the bidding at a foreclosed
property auction is competitive. It is based on the manner in which you
review it. This is a prime difference from other auctions and a clear
advantage.
It is important to understand the proceedings for purchasing real estate
that is in foreclosure. The next step after finding the property you are
interested in is to make sure you understand the proper repossession
proceedings in your state. Each state may have different stipulations
that you will need to be aware of in order to purchase the property as
smoothly and simply as possible. Check at your local library for more
information on these proceedings or talk to a lawyer. Because purchasing
a piece of property that has been repossessed can be legally tricky, it
may be sensible to retain the services of a lawyer just in case.
The possibility of getting a good profit on there properties is quite
high. The fact is that there are many foreclosed properties that entail
a fair amount of cleaning and maintenance and fixing there are also
properties that are in quite a good condition and they do not require
too much of maintenance and repair. There are many foreclosed properties
that require little maintenance and repair and they are made livable if
a little bit of repairs are done in them. The banks and other financial
institutions keep the property and they sell them out at a good amount
of money for them. These real estate properties we are talking about are
available for sale and you can get a good deal out of them. If some
renovation needs to be done you have to examine the property and then
find out to what extent the repairs are needed.
Before you purchase, be sure and inspect the property. Once you are
familiar with the course you will need to take to purchase the
foreclosure real estate in your name, you are going to want to inspect
it yourself. The services of a professional contractor may well be worth
the extra money you spend in order to determine that the property is in
good, liveable shape. If you are willing and able to repair cosmetic
damage, make sure the property is secure, solid and not needing any
immediate, large-scale renovations.
Also have the property checked for insects, termites, or other
potentially harmful animals and bugs. Even if the real estate is a
simple strip of land, you want to make sure that it is in good shape for
whatever you have planned to do with it. Because most of these
properties are sold the way the previous owner�s left them, you must be
aware of what are getting. If at all possible, make one more visual
inspection of the property before the final contracts are signed to
ensure that there is no more damage than what you initially noted.
Contact your real estate agent again and get a print out of the
equivalent value of similar properties in your area. Make sure of
ownership and make sure they do have any other liens on the property
that could forestall your purchase. This may be accomplished by having a
title search done at your local government office. If there is a lien on
the property, find out what will need to be done in order to have it
detached.
If everything is copasetic, then you are ready to contact the agent in
charge of the foreclosure. Find out what is the minimum amount the bank
will accept for the property and have your financing ready and in place
if you are not assuming the loan. Be sure that there is no grace period
for the current owner to buy the property back. This is a protection of
your rights. And finally, make a bid on the property. Above all else,
make sure you enjoy the piece of property you have just purchased. This
foreclosure real estate has become your little slice of heaven for a
fraction of what you could have paid.
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