How to Buy a Foreclosed Home

How to Buy a Foreclosed Home

Unless you have been living under a rock, in which case you probably aren’t too interested in the housing market, you have no doubt heard about how many homes have been foreclosed in recent years. Because of the financial crisis and other factors, records numbers of foreclosed homes have hit the market. While buying a foreclosed home can be a more challenging process than a traditional purchase, it can also allow you to get a great home for far less than it would otherwise cost. If you have been wondering how to buy foreclosed homes and save countless dollars on your next purchase, the following tips are a great place to start.

Five Time Saving Tips for Buying a Foreclosed Home

Beware of Hidden Costs

The sticker price of a foreclosed home is often too good to ignore. However, foreclosed homes are often in less than ideal condition and may require costly repairs and upgrades to be brought up to your expectations. That fact needs to be figured in to the total cost of buying the home. Do you have the room in your budget to afford the home purchase and the repairs? If not, the purchase might not be a good decision.

Consider the Time Frame

When a house lies empty for an extended period of time, things like plumbing and heating systems might not work as they once did. Make sure to ask about how long the house has been empty, and test as many of the parts as you can before you make the purchase. A stale home won’t always bounce back to life without some expensive work being done.

Get an Inspection

You often cannot get access to a foreclosed home before buying it. However, if you can, have a thorough home inspection completed. You will likely have to pay out of pocket for the inspection, but that will be money well spent. Covering your bases and having the home approved to you by an inspector is peace of mind that will go a long way.

Think Twice about Bad Neighborhoods

The lowest prices on foreclosed homes can often be found in less than desirable neighborhoods that have been hit hard by foreclosures in recent times. While you can get in for cheap, the money you spend might not end up being a great investment because the neighborhood around the home could damage the home value in the long term.

Research other Foreclosure Sales

In order to properly negotiate with the bank and get a fair deal, you should know what comparable properties have sold for in the same area. This information is widely available online, so take some time to study up on other foreclosures and you will quickly see what a fair deal looks like.