Foreclosure happens when owners stop making payments on their mortgages. The bank takes over the properties that are collateral for the loans. The bank then sells them in hopes of recouping all or some of its losses. Often banks sell these homes at reduced prices.
You may want to snap up one of these bargains if you are house hunting! Keep in mind, however, that while you may save money on the asking price, you most likely will pay other costs for inspections and repairs.
- Buying a foreclosure is risky because of the condition of the house and the potentially slow process. Any mistakes can be expensive.
- Be sure to have a competent Real Estate agent who can help you with the complexities of purchasing a foreclosed home. If the price is a real steal, expect other buyers and agents to be vying for it.
- Do your research and don’t end up paying more than you intended in a bidding war.
- You may have to be patient while the process drags on. Do not expect to negotiate. Banks have set a price and are rarely in a hurry.
- And you will move into a house that most likely needs appliances and possibly serious repairs.
- Never ever skip an inspection, if you can have one. Foreclosed homes often have gone through a tough time as previous owners’ finances suffered, and sometimes they have been empty a long time. Be sure you know what you are getting into because bank sales are AS IS.
Buying a foreclosed property requires a leap of faith, proper preparation, and the guidance of a helpful real estate agent. Contact the Scherer Team at 888-300-4431 to see how they can help you learn if buying a foreclosure is right for you!