Factors to Consider When Buying a Foreclosed Home
Today, foreclosed homes are flooding into the market, creating great opportunities at discounted prices for willing buyers. Although these homes are great for some, they may not ideally be the best option for others. Before getting serious and signing on that dotted line, Mortgage Lending News recommends you take the following factors into consideration.
In order to take advantage of the positive aspects that can come out of a foreclosure deal, one must be aware of the possible negative side effects. One potential issue involves the title. Buyers interested in a foreclosed home should make sure to get a title check even if the buying process doesn't require one. If there are any additional liens, such as a second mortgage or taxes, they may still be attached to the property and passed on to the new buyer. You must be aware what you're stepping into when purchasing a foreclosed property.
Inspections are also highly recommended as a way to find out exactly what kind of condition the home is in. Some properties may not be open to inspection and may be sold "as is." Understand that these properties may not be in the best condition. If the home has been abandoned for a lengthy period of time, there is always a chance it can have a pest or infestation problem, mold growth or maybe vandalism issues. It is highly recommended that you get an inspection on any property you plan to purchase, says Mortgage Lending News.
In addition to a title check, buyers should also consider a property disclosure statement, though this also may not be required. If a disclosure statement isn't part of the deal, it puts even more stress on having the home inspected. Make sure you are well aware of the conditions of the plumbing, electric wiring, foundation, etc. You don't want to be left with surprises down the road that could end up being large financial burdens.
Additional research is recommended for those considering making a bid on a foreclosed home. Some foreclosures could be accompanied by a set of problems, but if you conduct the proper research and take the right steps, you could end up with a killer deal and a very positive transaction.
Reprinted with permission from RISMedia. ©2013. All rights reserved.