Given that in 2016, there were more than 427,000 completed foreclosures, it's obvious that there is definitely the opportunity to save money on homes that others have been unable to keep. However, foreclosed homes often present unique challenges and in exchange for that savings, you may need to fulfill some very specific requirements. Therefore, if you're ready to buy a foreclosed home, you need to be aware of the following information.
Foreclosed Properties Are Often Sold At Auction...And Auction Rules Apply
One aspect of purchasing a foreclosed home that has often been a problem for buyers relates to how they are sold. Foreclosed homes often sell at auctions held on courthouse steps and it's not unusual for the person with the winning bid to be required to provide 10% of the winning bid on the day of the sale. In some areas, you might need to have the full amount of your winning bid on that day.
It usually needs to be paid in a cashier's check or money order. If you want to pay with cash or a credit card, it's best to speak with the auctioneer or person in charge of the sale prior to the big day to confirm what is and is not allowed. If you cannot provide the down payment on the big day, you might lose the home or be held responsible for the difference between what you promised to pay for the home and what the next higher bidder is willing to pay.
Expect To Pay Off The Balance Within 60 Days (Or Less)
The next problem some new buyers run into is that you will have 60 days or less to pay off the home. That means that you will ideally either have your own funds to pay off the home or you were already been approved for a home loan before the auction.
During that time, there might still be pending legal action against the former owners of the house to force them out. Although you are not permitted to enter the home or yard, you might be able to see the the exterior of the home or its yard from the sidewalk or street. You should speak with a lawyer about what you can and cannot do during that time period and never plan to make contact with the existing occupants of your new home.
In conclusion, foreclosed real estate is often an ideal way for savvy buyers to get the best price on a new home. However, there are often some strict guidelines associated with buying that type of property, so it will be quite useful to consider the above facts as you are navigating the process of finding your new home. If you are interested in buying a foreclosed home, then learn more by contacting a real estate services business.Share