Eight Ways to Tell if a Foreclosure is a Good Deal!
Buying A Foreclosed Property? Eight Ways to Check If the Deal Is Real
Information is power, as they say. Becoming informed about a foreclosed property with potential is a must. There may be unresolved issues regarding occupancy, environment, claims, permits or structural issues, all of which may negatively impact the required time frame or budget.
Unless you know which elements to look for, you may not be able to distinguish a good deal from a bad deal. Some of the most overlooked considerations real estate investors or hopeful homeowners should be aware of when purchasing a property in foreclosure.
- “As Is” Condition
Many foreclosed properties are sold in “as is” condition. That means the buyer assumes the risk of all environmental issues, title claims, open permits and open violations. It’s important to have an experienced team help assess the house. The team can help mitigate the risks, and the discounted price of a foreclosed property can make the purchase well worth the additional effort.
Liens and other claims on the property title are often overlooked when considering purchasing a property in foreclosure. Things like unpaid contractor liens from years ago and convoluted inheritance claims are common among foreclosures and can tie up a closing with red tape. Many buyers think they have an excellent deal until they experience the headache of trying to achieve a clear title.
- Structural Inspections
It’s important to realize that foreclosures include an unhappy owner who is forcibly made to vacate the property. It’s not uncommon for foreclosed homeowners to devalue the property by removing fixtures or even causing structural damage to the house. Hiring a professional inspection company like the Building Property Inspections Melbourne can mitigate financial loss down the line.
- Home Warranty
Many foreclosures are sold “as is” and have been vacant for a while, which can impact the functionality of a water heater, furnace, plumbing, bathroom fixtures and appliances. Be sure to get a home warranty so that you’re protected if something breaks after you move in to protect yourself.
- Knowing What You Are Buying
Are you buying a home in the foreclosure process, or buying a bank-owned home? If you are buying after it has gone through a bank foreclosure, your risk is focused on the condition. Unless you are very experienced, let the bank do the hard work so you can get a “free-and-clear” property. Remember, it isn’t a deal just because it is a foreclosure. Banks are much savvier than they were 10 years ago!
- Zero Control Over A Closing Date
When acquiring a home that’s in foreclosure, the No. 1 rule to keep in mind is that you are at the mercy of the bank or lien holder(s). As a result, you have absolutely no control over the amount of time it will take to get to closing. Sometimes the minority lien holder(s) are ready to settle, but the majority holder is not. If time is of the essence, targeting a home in foreclosure is not for you.
- The Myth of The Cosmetic Fixer
Do “deals” still exist? Short sales and foreclosures are a good, cheap option. However, if a property has been neglected, which most of these properties have, the systems have also been neglected. Moisture damage, mold, sewer lines, roof, foundation, plumbing and electrical should all be pre-inspected prior to submitting an offer. System repairs can eat into the budget. Make sure the deal is real!It’s all out being insightful and stretching that dollar, a good painting does not have to be expensive if you choose the painters and decorators dublin, you can get an affordable price and make your house look beautiful and alluring.
- What You See Is Not What You Get
What most people do not know is that the previous owner can take everything in that house with little legal ramifications. So, say goodbye to those new appliances or beautiful marble countertops. The other problem is people think foreclosures are amazing opportunities to get a great deal. This common perception creates a frenzy of buyers who often bid up the property to regular market value. #Real Estate
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