When purchasing a foreclosure be sure to have a knowledgeable Realtor and loan officer working with you. If you are not paying cash and going with a FHA backed mortgage there are a few issues you will encounter.
First, the banks have the homes winterized which means the water and heat is shut off and the pipes have anti-freeze so they don't freeze. The buyer is responsible to have the home dewinterized in order to have the systems inspected.If the buyer chooses not to go through with the purchase they are responsible to have it re-winterized costing anywhere from $300-$500.
Bank owned properties are sold as is so buyers do a home inspection for thier own protection and either move forward with the purchase or get the deposit back providing its in the time frame the contract allows. There are 203K loans which allows you to buy the home and do the repairs needed to make it habitable. This a better option for a buyer who isnt doing the work themselves. Buying a foreclosure can be a great investment but just make sure you are working with professionals.
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