The purchase of a home is often the biggest and most nerve-wracking experience many people will encounter in their lives. While an exciting event, it can also be fraught with pitfalls if the buyer is not careful. Some of the biggest issues can occur when the purchase involves a foreclosed home, where there can be multiple parties and multiple problems to deal with. However, with a little homework and relying of the advice of experts, it's very possible to buy a foreclosed home with few if any problems.
Auction and Lenders
Though many homes are sold at auction, often at very low prices, the majority of foreclosed properties are sold through lenders such as banks that held the mortgages on the properties. While the banks are anxious to unload these properties, they are also interested in making as much money as possible to lessen the money they lose on the sale. Most foreclosure experts agree that when a buyer finds a foreclosed property in which they are interested, it's best to use their own real estate agent rather than the listing agent. The listing agent has the bank's best interests at heart. It's also possible the bank has never seen the property, so there may be issues regarding a clear title or the property's condition.
When a buyer is seeking an agent to help them with their purchase, it's a good idea to find one that has experience with foreclosure sales. Most realtors belong to the National Association of Realtors, and many are able to gain certification in foreclosures and short sales. Because so many more homes today have been involved in foreclosure, most agents have this specialized training.
Condition of the Home
After a buyer has secured their agent, it's time to get down to the business of taking a close look at the house. Most foreclosed homes are vacant, but not all of them. This can pose a big problem not only in viewing the house, but also in what condition the house will be in when the current owner leaves. Many owners are not happy about leaving, with some spending time vandalizing their own home as a result of their anger. Whether the house is vacant or occupied, a home inspection is an important part of the process. This will let the buyer know what's wrong with the house and if it is worth pursuing as a viable option. While a property may initially seem like a good deal if it's offered at a low price, it may cost far more to fix up than a buyer can afford or would want to spend. By using a certified home inspector, a buyer can know exactly what will be needed before closing the deal.
So while foreclosed properties involve a good amount of risk, if buyers surround themselves with experts who are experienced in foreclosures the process can be relatively stress-free and profitable to everyone involved.
