ANSWERS: 1
  • Foreclosed homes provide buyers with an opportunity to purchase a home at a discount as lenders try to move the property and collect monies owed. Several steps are involved in purchasing a foreclosed home.

    Find a Property

    To purchase a foreclosed home, you must first locate a property you are interested in. You can buy a subscription to a foreclosure listing or work with a real estate agent.

    Auction or Market

    Foreclosed homes are generally sold at auction. Many times the lender will win the auction and place the homes up on the open market for sale. These houses can be bought at auction, with the home being sold to the highest bidder. If they are purchased on the market, it is usually well below market value. The lender is merely trying to recoup losses on the previous loan.

    Make an Offer

    Make an offer on a foreclosure on the market. Depending on where the home is in the foreclosure process, you will need to make an offer to either the lender or through a trustee. Working with an agent who is experienced in buying foreclosures will help you navigate this process.

    Considerations

    Keep in mind that most of these homes are vacated on less than hospitable terms. Repairs may be needed. Many homes have been vacant for some time, meaning they could have been vandalized or items may have been stolen. A physical inspection of the property may be in order before making an offer or bidding on a home.

    Auction vs. Market

    There are no set prices for buying foreclosed homes. Buying them at auction may yield a deeper discount than buying on the market, but there is no guarantee that you will win the auction.

    Source:

    CNN

    HUD

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