Buying a bank owned or REO (real estate owned) home gives you the potential of getting more house for your money. But it is a bit different than buying a normal resale.
Before you begin searching, here are a couple of things you should know:
Get Help:It is wise to find a real estate agent who has a background in buying and selling foreclosures. Also foreclosure laws vary from state to state and can be tricky. Along with your real estate agent you should also consult with a real estate lawyer who understands the ins and outs of buying foreclosures.
As-Is:There is usually not much room for negoatiation. Since foreclosures are mostly sold as-is, you should not expect to get a discount to compensate for repairs.
Get preapproved:Unless you are paying cash, the seller will want a preapproval letter from a lender before accepting an offer.
Search Listings:Have fun and start searching! There are many sites to search for foreclosed homes.Homepath.comis a foreclosure listing website owned by Fannie Mae. On Homepath.com, you will be able to see foreclosures that qualify for Homepath and Homepath Renovation loans. There are also incentives for first time home buyers. There are only a few lenders that are approved for Homepath loans. Do a search on the Homepath website to find a loan officer near you. Dont forget to consult with your real estate agent as she may have access to other listings that you will not.
Inspection:An inspection is very important when buying a forclosure especially if the property has been vacant. Many forclosures have problems that are not easy to find. A trained inspector will be able to detect mold build up, broken pipes, etc. If the inspections goes well, you still may have to invest extra money in repairs. The previous homeowner may have neglected regular home maintenance or intentionally damaged the home. You may also need to buy new appliances.
Once you find your home and make an offer, be prepared for the process to take longer than a normal home sale. Many banks have several forclosures listed at any given time. You should also know that they will have several steps of approval that your offer must pass.
If dealing with the above issues is something you are willing to do, buying a foresclosure is a great way to get your new home at a cheaper price. Dont forget to educate yourself so that you can make sure the deal you get is worth the added repairs,etc. that may be needed.
For more information on home buying, contact Sheri Jones at 909-660-1838Sherijones2012@gmail.com #BuyingForclosures #RealEstate #HomesBySheri