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Should I buy a Foreclosure?

By
Real Estate Broker/Owner with Edge Of The Beach Realty 53243

 

So you want to know more about Foreclosures?

 

First, I would like to say that I have a lot of empathy for those people who are losing their homes and have tried their best to hang on in these tough times. 

Often due to a loss of a job or a health problem, the owners are not able to take care of their property.  Due to the lack of funds both the mortgage payment and the routine maintenance comes to a halt.  Their home starts to show signs of deterioration.  Then the property eventually goes into foreclosure.  This is what happens when a homeowner is not able to pay the bank the money they owe. The bank takes the property.

I get a lot of e-mails and phone calls each day from people asking about purchasing foreclosures.  I often find that these are people who are looking for a deal but may not understand that there are many draw backs to buying a foreclosure. It is important to keep in mind that there may be other distressed properties out there that are not foreclosures and should also be considered. Let’s look at some considerations.

Is a foreclosure always a good buy?

In most cases, the amount owed is much more that the property is worth.  It can often be over priced since the lenders do not want to lose more money than is owed or at least they would like to keep that loss to a minimum.  Some foreclosures are priced below fair market value and others are not.

There is no history available on the property and no seller disclosures that tells you about any problems the home may have had. Although a home inspection can and should be done, the home is being bought "as is" and the bank is not likely to pay to have the utilities turned on or do any repairs.

After making the necessary repairs will it still be a deal?

How much will it cost to bring it back to good condition? These properties are often not in good shape and have not been taken care of.   Many have even been abandoned for months and months. You can always expect repairs. Those repairs can often eat up the savings you make in the purchase so the decision to purchase needs to be made very carefully.  I advise anyone that is going with an FHA loan not to purchase a foreclosure as all repairs would need to be made before closing, so you would need to spend money before you own the property!

The utilities are often off for a long period of time and invite problems in certain parts of the country….. freezing or humidity can wreak havoc on a home.

 If you are patient and do your homework  as well as understanding the risks involved, you may find a gem!       In many cases you might just be able to find a steal of a deal. My advice is to keep all options open and look at all of the inventory. You could find just what you are looking for .. a great deal !!!  Just understand, there are pitfalls to the journey. 

 

The communication is often a third party.

This can be difficult to work with and get information in a timely manner.

Can you get a clear title?

Is there a second mortgage holder? 

The journey is not for the weak or intolerant. Are you ready?

Lets look at all options when you search for your "deal"!

 

Our Team is ready to guide you through & help you through the process of your home purchase!

Should you have any additional questions or if you would like a list

of the foreclosures in the Myrtle Beach and Pawleys Island area please call us Joanne or Janice

at  843-655-6343 and be sure to visit our web page at

www.EdgeOfTheBeach.com

 

Joanne

 

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