Tips to Buying a Foreclosure
by Tyler on 11/24/09
By now you’ve probably heard here and there that someone you know has purchased a foreclosure at a great price. As we come to a close of 2009, there isn’t much inventory to choose from like there was 6 months ago. The first-time homebuyer tax credit has been extended and there are more buyers searching for homes at the moment. Just because prices are low and you are anxious to own a home that is affordable, don’t go rushing into things.
Here are some tips to that will help with your foreclosure search:
- Don’t overpay. This is easy to do with the amount of buyers out there right now. You see, when a property comes on the market that sparks your interest, well it also sparks the interest of 50 other buyers. This causes a bidding war which can force you to pay too much for a property. Make sure you and your Realtor® go in with a strategy to present the best offer out there.
- Work with a Professional. Purchasing a foreclosure takes knowledge and skill in this type of market. There are few real estate agents out there that deal directly with banks everyday. These are the Realtors® who are going to get your the property you are searching for because of the experience they have dealing with the asset managers.
- Account for fix-up costs. Foreclosure properties are being sold in “as-is” condition. It is rare to find one of these properties that is brand spanking new and ready to move in. Tour the property with a contractor to give you a better idea of what the rehab costs will be.
- Make smart offers. Your Realtor® should be probing the listing agent to find out how many offers are in and possibly even finding out what the highest offer is. This is their due diligence to you. Having all this extra information will help you submit your highest and best offer without being unpractical.
I can’t stress enough how important it is to hire a Realtor® who is heavily involved with foreclosure properties themselves. They have the inside track and knowledge that often gets overlooked those “we know” buyers.
