Guide to Foreclosure Sale for Home Buyers
Foreclosure happens when the property’s owner is unable to keep up the periodic repayments to a lender or is unable to pay the real property tax owed to the local government. When these happen, foreclosed properties then become attractive to home buyers because of their lower selling prices. Foreclosure buyers could save a significant amount of money when they buy a foreclosure home. Acquisition of a foreclosed property requires awareness of the buying process and considerations that differ from buying a newly developed property.
Acquiring foreclosed properties may be done through a lender, such as a private bank, insurance companies, or through a real estate broker. It may also be done through auctions of government agencies or through any other official listings.
Foreclosed properties can be advantageous both to homeowners and buyers or investors. Either way, home buyers must be guided properly before entering into any agreement. Before attempting to buy a foreclosed home, home buyers must understand the process that may occur when a bank forecloses on a house.
The following pointers are some guides to consider for home buyers on a foreclosure sale:
- LOCATION. Regardless of the property’s condition or selling price, home buyers must consider the location’s various factors, such as the area’s safety, as well as access to basic services like schools and hospitals. Buyers may also look at the access to major thoroughfares, transport hubs, malls, and commercial developments in the area.
- PROPERTY’S CONDITION. Prospective buyers must take extra care to check for structural flaws and pitfalls, or features such as plumbing that may require repair. These are additional costs to consider in the acquisition of an “as-is” foreclosed property.
- CHECK YOUR FINANCES & FINANCIAL OBLIGATION. Several options are available for buyers, such as mortgages and contracts, to sell from banks, brokers or governmental auctions. There are normally rules and restrictions as well as upfront obligations at times.There are pros and cons for both options. Home buyers must know every single detail in order to save more on foreclosure sale. Foreclosed properties can also appreciate in value depending on ongoing or future developments in its vicinity. Hence, future re-selling of the property is profitable for “buy-and-sell” investors.
- CONSIDER FUTURE COSTS. Foreclosure buyers must evaluate the condition of the property and must consider the potential cost of repairs, if repairs are needed. Buyers should consider this additional cost when making an offer to buy the house. Foreclosure buyers might even want to offer a lesser amount to account for the cost of repairs.
- TRANSACT WITH A REGISTERED AGENT. The first two tips for buying a foreclosure should be considered both at the same time. While many buyers prefer direct negotiation in the purchase of a distressed property from owners, others may still engage the services of a real estate broker or agent. While you’re looking for a real estate broker who works directly with banks that own foreclosed homes, get a pre-approval letter from a lender. Working with accredited brokers or agents helps give buyers peace of mind, as well as ensure fewer problems with transactions and move-in processes.
Seek your agent’s advice on how to proceed with this. And if you’re looking for a reliable agent, we are here to assist you as well! CPD Homes is a Cleveland, Ohio-based company here to help homeowners out with any kind of situation.
Whether you’re a buyer looking for a foreclosure sale, or a struggling landlord, or just want a sound investment yielding significant ROI, we are here to assist. Call us at (216) 282-7824 or visit us at www.cpdhomes.com.