What do buyers today need to know when considering lifestyle changes and looking to purchase bank owned/foreclosure properties with acreage here in Colorado? Location and access to main highways would be prudent to investigate, but there are other equally valuable issues surrounding acreage parcels that should be scrutinized prior to purchase.
1. Does the land have direct access to maintained roads?This becomes increasingly important for commuters to work.I suggest timing the drive to the property, add minutes for inclement weather, and see if it still is within a reasonable commute to work or amenities.Does the land have easement access or direct access?
2. Right after location one needs to consider source of water in Colorado.What type of permit is granted for the land?This will determine lifestyle and can take that picturesque ranchette dream into a nightmare without proper research.If your Realtor does not have the Colorado State Water Engineer on speed dial……..give me a call!The listing agent for a foreclosure might not have the well permit info or the correct info and onus is on buyer to research.Old well permits can be researched with the legal ID including range, township, and section numbers.
3. What are the covenants governing the area? Are you limited on number of domestic animals (horses)?If Alpacas and chickens are the dream then make sure Alpacas and chickens are welcome in the neighborhood. Is the plan to eventually have multiple family homes on the property? Are the buyers looking to run a business on site?
4. What are the available utilities?Is there natural gas lines to the property or is propane going to be the source of fuel?Is electric run to the property?Are there septic system schematics available at the building department and is the system up to today’s codes?
5. Is the lender going to require a full survey on the land?Some of our parcels have a sufficient ILC (Improvement Location Certificate) that will be accepted by the lender but if a full survey is required that is an expense that could cost $3,000 or more.
6. Insurance requirements should be pursued prior to closing.Is the property insurable now in its “as is” condition or does the buyer need to consider an FHA 203K loan? Will your lender require outbuildings to be insured?
7. Buyers talk to the neighbors.Neighbors can tell and they will about the history of the property, the previous owner’s usage, renters, and other such tidbits that might provide a valuable snapshot to the story behind the now vacant foreclosure.
A foreclosure parcel is one way to purchase a rural property to pursue a more self-sufficient lifestyle and can be an opportunity to make a wise investment in real estate for the future.Investigating details is the key to success with foreclosures and partnering with a Realtor comfortable with rural properties can provide the resources and experience necessary to make that Colorado dream a reality.