Buying a foreclosed property can be different than buying other types of real estate.
In many cases you will be able to get a fantastic deal on a home, but you will need to go through quite a bit of work and negotiation.
Here are four tips to help you navigate the foreclosure buying process:
Find the right real estate agent
The first thing to keep in mind is that your real estate broker will deal directly with the bank that owns the foreclosed property.
The bank has the final say in whether they’ll accept your bid – so you want an agent who has developed a good relationship with them.
Know that cheap doesn’t mean good value
Sometimes the tiny price tag on a foreclosed property can be very tempting, but make sure you are asking questions about the value and the potential expenses of the house.
Will it require extensive repairs?
Will you be able to find a tenant?
Does the property have potential for appreciation over time?
Perform a house inspection
If the previous owners were foreclosed on because they couldn’t make their mortgage payments, it’s possible they didn’t have enough money to give the home the proper maintenance it needed.
Make sure you have the property inspected by a professional to spot any problems.
Take extra care if the house has been empty for a while, as there could be problems with plumbing, insects or mold.
Look for intentional damage
Keep in mind that many owners were forced out of their property by the bank, so they might have removed as many appliances, light fixtures and other items as they could which usually means the house is stripped bare.
The previous owners might have been angry and felt justified in damaging the property.
Make sure to do a thorough inspection to find out what appliances you’ll need to buy and messes you’ll need to clean up.
If you are considering buying a home in foreclosure, you could possibly get a great deal on a house with a lot of potential.
Make sure you follow these tips and contact your licensed and trusted real estate professional for more information about buying a foreclosed property.
Aaron White says
November 10, 2020 at 2:43 pmI liked how you mentioned that you should have a foreclosed property inspected before buying it. My wife and I are wanting to get into real estate investing and we were wondering how we could buy a foreclosed property. I’ll be sure to tell her that we should get a foreclosed property inspected before buying it.