Five Tips for Buying a Foreclosure

**gobransonhomes** · 08-26-2009, 01:42 AM

We've been working with a number of home buyers whose home of choice happens to be a bank-owned property. Yes, it has been interesting ... walking into a home and finding an empty room where the kitchen should be, or finding rooms with missing light fixtures, etc.

But, for some the property they want to call "home" is part of the "distressed" sale market. And, with this type of property/seller, it can be quite a different transaction.

Here are five tips for buying a foreclosure:

1. Be patient. The banks work on their own time frame, and this does not include weekends or evenings. Most have files and offers stacked up, and are trying to get through them as quickly as possible. The banks don't want the properties on their books any longer than they have to.

2. Do your due diligence. There are fewer disclosures on bank-owned property, and as such, the risk is with the buyer. Have inspections so that you are comfortable with your level of knowledge about the property condition. Some lenders will provide a termite inspection/clearance, some will not. If not, consider paying for one yourself. Inspect - inspect - inspect.

3. Know your budget. Yes, bank-owned properties are generally below "market" value. However, we are seeing multiple offers on these properties, with the eventual sales price going for more than asking. When you combine the increased sales price, the amount of money you spend on inspections, and then include necessary repairs (that are funded with cash out of pocket) ... make sure the property really does fit your budget.

4. Pick yourself up and do it again. You may not get the first property you make an offer on - or the second - or the third. If your offer is not selected, then move on to another property. There are more homes coming on the market every day.

5. Use a real estate agent. Using a real estate agent will give you access to the greatest number of homes; and with their professional guidance and expertise, will help you succeed in today's real estate market.

**easyrent** · 08-27-2009, 08:27 AM

Agreed!! Thanks for sharing those tips

**windermereestates** · 09-02-2009, 12:32 AM

Wonderful tips. Thanks for sharing it here!

Barbara

**janice** · 09-03-2009, 06:47 AM

I will keep all those tips on my mind, anyways thanks for sharing them with us

**vijendrasnv** · 09-03-2009, 02:51 PM

Hi,

Thanks for sharing information.
I like the third tip which is really very important regarding the investment of foreclosures.

Thanks.

**Nick Brian** · 09-06-2009, 03:55 AM

Good piece of information. I would say, knowing your budget is the number one issue. Sometimes home owners mess up at the end just due to the fact that they had no clear idea about their budget.

Anyway, good luck to those who are opting with foreclosure. Thanks. Nick Brian.

**realboy0** · 09-07-2009, 07:19 PM

Patience is really a virtue in any kind of business especially in real estate.. If you want to stay in this game, Be sure to have a lot of patience to close a good deal.. Buying a foreclosure, I think the most important is considering your budget and getting the price that you want...

**jerrydhawkins** · 09-07-2009, 11:39 PM

Agressive marketing is the key to survival. I own 3 Luxury Homes in NW AR that I would love to be able to short sell but the banks want to keep holding on. I think it's still gonna get worse