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What to beware of when looking to buy a foreclosure
09-08-2011
What to beware of when looking to buy a foreclosure
August 1, 2011
According to RISMedia, there are some key factors home buyers should keep in mind when considering purchasing a foreclosed property. While the low price of foreclosures can be tempting to home buyers, the properties may come with baggage.
With many distressed properties on the market to choose from, RISMedia reports home buyers should take into account some specific considerations regarding the homes to ensure they know what kind of property they may be purchasing.
Hire a professional home inspector
As with any other type of home for sale, RISMedia reports home buyers should hire a professional home inspector to thoroughly look over a property to make sure it's worth the potential investment.
Many foreclosures sit on the real estate listings for extended periods of time, and banks which own the homes often don't maintain them well, so getting a complete home inspection is vital to the home buying process, according to RISMedia.
Don't focus solely on price
One of the main reasons home buyers consider foreclosures as a possible new home is because of their low prices. However, RISMedia reports the price tag is only one of many considerations home buyers need to think about during the home buying process.
A foreclosed home may need repairs and renovations, which could be costly, RISMedia reports. Home buyers with little capital may want to skip these kinds of properties.
Bid low, but be ready for wait
CNNMoney reports many banks want to offload foreclosures to get at least some return on their investment with the prior homeowners and will offer the properties for a low asking price. Home buyers should consider making an initial offer near that asking price.
However, competition for some distressed properties is high, particularly in areas with nice neighborhoods and plenty of job opportunities nearby, according to CNNMoney. For these reasons and others, home buyers should be ready to wait for a bank's response, as they may decide they can get a higher bid from someone else.
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