Forecasting a Foreclosure Sale in Your Future? Get the Facts First!

In many markets across the nation, the foreclosure rate is dropping rapidly, which is a great sign for the real estate industry and the economy in general. While that certainly is welcome news, there still are foreclosures that exist in today’s market. Likewise, there still are many motivated buyers who would like to strike a deal on a foreclosed property.

However, striking that great deal on a foreclosure can be easier said than done. Buying a foreclosed home differs greatly than buying a home through a conventional real estate transaction.

Before You Begin Searching for a Foreclosure

If you’re looking to make a deal on a foreclosed home, fear not! There are ways to educate yourself on the process. Likewise, there are trusted real estate professionals at the ready who specialize in completing foreclosed property sales.

In fact, before you even begin to find a foreclosed home that you might like to purchase, it is best to align yourself with an experienced real estate agent that is comfortable dealing with bank foreclosures. Similarly, it is vitally important to seek loan preapproval before approaching a bank about a foreclosed property. Most foreclosed properties sell quickly; so, you need to prove that you’re a very serious buyer to even be considered.

Onto the Home Search Process

It is incredibly important that you personally tour each foreclosed home that you are considering. It is said that pictures are worth a 1,000 words, but when it comes to foreclosures, seeing is believing.

Many foreclosed homes have been vacated by their previous owners and many of those owners may not have been happy to have to leave their beloved homes. Unfortunately, prior owners can wreak havoc on their homes before vacating. What does that mean for you, a potential buyer? Do your due diligence.

When you find a foreclosed home that you’re interested in, tour it and check the home’s overall condition. Don’t be afraid to test out the faucets, toilets and any other appliances or equipment to make sure that everything is in working order. Hire an inspector to thoroughly scour the home to make sure there are no irreconcilable damages.

You see, that’s the next thing about buying a foreclosed property. Any needed repairs typically fall on the buyer. Foreclosures are often sold “as is” and in many cases, repairs are inevitable. Further, when it comes to foreclosed homes, there are no disclosures. If possible, check any past permits and title records to find out as much as you can about a property. Again, a realtor with foreclosure experience may be able to help obtain any existing information.

Making an Offer on a Foreclosure

If you’re ready to buy a foreclosed property, you should know that the price tag may be pretty much set, with little-to-no-room for negotiating. Remember, banks may be selling foreclosed properties for a loss; so, they want to minimalize that loss as much as possible.

If you make an offer on a foreclosed property, remember that although banks are motivated to sell their properties, they also want to receive as much of the money that they are owed as possible. So, you may not hear back on your offer right away. If there is a lot of interest in a property, they may be waiting for better offers. In fact, some properties may sell for more than their asking price.

On the plus side, when your offer is accepted on a foreclosed property, the closing process is usually much shorter than with a conventional home sale. There are fewer parties involved, so there is less paperwork to be completed. Finally, because foreclosed homes usually have already been vacated, the move-in process can begin immediately!

Even with an improving real estate market, foreclosed homes remain available for motivated buyers. If you’re in the market to strike a deal on a foreclosed property, contact a Berkshire Hathaway HomeServices The Preferred Realty realtor who has the experience to help you through the foreclosure sales process today.