Should You Buy a Foreclosure?

The latest media reports are projecting a second tidal wave of foreclosures to hit in late 2009 or early 2010 as unemployment remains high, home prices continue to fall and banks’ self-imposed foreclosure moratoriums expire.

Now may seem like the perfect time to find prime real estate at a bargain-basement price and buy a foreclosure.

Despite the hype, nationwide, foreclosures still comprise less than 3 percent of the actual market nationwide.

In reality the foreclosure market is very small. Delinquent mortgages have hit about 7 percent of total properties, which means that 93 percent are still in good standing.

Although, there are still plenty of foreclosure bargains out there, no matter where you live, especially if you are patient and well-educated in your market.

In order to get the best deal on a foreclosure you need to make a strong offer, likely in cash, without any inspection or financing contingencies.

With no contingencies you can save thousands of dollars. But that’s where a first-timer could get into trouble. The house could have problems with mechanicals, foundations, electrical or any number of big-ticket items. Always consider adding on an additional $10,000-$20,000 in the final purchase price to cover any hidden major expenses.

If you are interested in buying a foreclosure, contact Eddie Perez Broker-REALTOR, CDPE, to find out all the benefits and options. Eddie’s market includes Hoboken, Jersey City, Weehawken and Union City.  He can be reached ateddie@InvestHoboken.com or 201-344-2886.