Tips on Buying Foreclosure Properties

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If you’ve been thinking about buying a foreclosure property as a smart investment or as a second home for your family, you may be on the right track. However, buying a foreclosed home is a task that should not be taken lightly. You need to know the ins and outs of foreclosures and that’s why Bargain Network has put together this must-know list of tips for buying such a property.
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If you’ve been thinking about buying a foreclosure property as a smart investment or as a second home for your family, you may be on the right track. However, buying a foreclosed home is a task that should not be taken lightly. You need to know the ins and outs of foreclosures and that’s why Bargain Network has put together this must-know list of tips for buying such a property.

You will need to expect to do a lot of research before finding a suitable property. In very rare instances, you may be able to purchase the first property you look at, but in general, it will take you hours of careful research and planning to find a foreclosure property that fits your budget and your needs.

Get Pre-Qualified: Securing financing early in the process is important because it will ensure that you are qualified to purchase the property. Being pre-qualified will also give you greater bargaining power when the time comes to make an offer. Find a lender that has worked with a number of foreclosures and understands the foreclosure process in depth. Taking the time to find the right lender will save you from a lot of frustration and may also save you from losing out on a good deal.

Know the Process: Knowing about the foreclosure buying process is an important part of purchasing such a property. You can buy a foreclosed property at auction, by working directly with the seller of the property, or even by working with a real estate firm to bid on the property. Finding out the type of process being used for the homes you will be considering gives you greater bargaining power and may help you to better negotiate a price and any additional benefits such as reduced closing costs. These Bargain Network Homes links can help:

Foreclosure laws | Foreclosure Glossary | Foreclosure Timelines

Figure out what you want: Putting your early efforts into researching properties, you’ll need to find reliable resources for information. You can start your search by using Bargain Homes’ exclusive Foreclosure Database. Take advantage of Bargain’s resources, and spend time looking for listings and make note of those that match your price range and your requirements for a property. If you’re looking for a 4 bedroom home, don’t settle for one that has three bedrooms; keep searching until you find what you’re looking for so that you can be satisfied with your purchase.

Research the Area: When you’ve put together a list of properties you may be interested in, your research is not finished. You will need to start looking into the benefits of the surrounding neighborhood, the availability of public and private schools, the population of the area, average property values, the rate of property value growth in the area, and the availability of career and recreational opportunities. There are many sources of information available on Bargain Homes that can help locate specific information. If you are working with a realtor, they can often provide additional property brochures and comparative market analysis reports that list information about the sale of comparative homes in the neighborhood. Finding out this information before visiting each property can save you a lot of time and eliminate neighborhoods that would not accommodate your lifestyle.

View the Properties: Once you’ve compiled a list of potential purchases, you may be able to schedule an appointment to view the property or attend an open house. This is the time to find out how accurate the listings were. Carefully examine every nook and cranny of the home, checking for structural damage, rodents, termites, plumbing and heating issues, and other common problems. Check to make sure that all features outlined in each listing are truly available with the purchase. Ask as many questions as you can think of before making a decision. Buying property is one of the biggest and most important decisions that can be made, and you need to have all the information available to you when you are considering all the factors involved in the purchase.

How much should you pay? Once you’ve viewed the properties, you need to consider the price, the condition of the property, and the surrounding neighborhood. Don’t make your purchasing decision based on price alone. A very low price can mean that the property was abandoned for many years or was not kept in good condition by the previous owner. It may need extensive renovations that can be expensive and time-consuming. Buying a more expensive home that is in good condition rather than a bargain-basement home that has extensive damage will save you money in the long run. You will also need to find out if there are any liens on the property or if the property has been affected by a bankruptcy. This information is not something you want to find out after you have already progressed through most of the buying process and can be a legal hassle to resolve.

Bid on the Property? Once you’ve finished all of your research and decided on a property, it will be time to negotiate with the seller or make a bid on the property. Depending on the process being used, you will be working with a number of professionals, which may include bankers, attorneys, real estate agents, and other representatives of the home. During this negotiation process, you may be able to get yourself a deal on the total cost of purchasing the home. If you’re working with a bank, you may want to look into taking over the existing mortgage. Some banks will waive closing costs or reduce the interest rate on the mortgage if someone assumes it at closing.

Once you’ve wrapped up the closing process, the home is yours to enjoy. You may need to repair some of the structure or even make minor repairs. Furnishing your new home and settling in may be one of the most satisfying times in your life. When you finally look around at the end result, you will be glad you tread carefully through the foreclosure buying process and did your research.

More Interesting Facts on Foreclosures:

Did you know that forclosures is the most common misspelling of the word foreclosure?

Did you know that foreclosure laws can differ by state?

Did you know that a short sale can be a sound alternative to falling into foreclosure?

Find out more from AOL Real Estate's Foreclosure Center

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