Tips for Buying a Foreclosure
-Never buy a foreclosure without physically looking at it. In today's real estate environment, many people around the country are looking at foreclosures in far away cities. Remember that the picture in the advertisement does not necessarily have to be the house you are looking to purchase. Trusting someone's word about what a home looks like or the condition that it is in can end up being a very costly mistake.
-Look at foreclosures and regular homes being sold by residents. In general, foreclosures bring the entire market down for a neighborhood (which is one of the reasons why there is a housing crisis). There may be a similar or better deal on a home where the owner has been maintaining it all along.
-The longer a foreclosure has been left vacant, the potential and likelihood of damage increases. Plumbing and appliances can suffer damage when not used. Pests tend to invade homes that are not occupied for long periods of time. Mold, frozen pipes and water leaks can occur. In order to avoid this, it is vital to have a home inspection done by a private, licensed inspector. Avoid using an inspector that is recommended by a realtor or a bank. Check their credentials out and hire them yourself.
-Check HUD for their list of foreclosures. They tend to be in better condition and cared for. They also tend to be better deals.
-Make sure you have budgeted accordingly. If you have chosen to buy a foreclosed home, make sure that you have enough reserves to make any unforeseen repairs that may occur once you have purchased. Some things don't appear right away but can easily wipe out your finances.
For anyone who is buying a home, today's housing market is offering a great opportunity. Home prices are down along with lower interest rates. The inventory of houses for sale is enormous which only means a purchaser has more to chose from and have a better opportunity to negotiate. Just remember to learn as much as you can before taking the leap in order to avoid pitfalls later.
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