Pros And Cons Of Buying A Foreclosure

Dated: 06/05/2018

Views: 250


Pros And Cons Of Buying A ForeclosureWhen a homeowner stops making regular mortgage payments, the bank can foreclose on the property. This means that the bank takes possession of the property in an attempt to recover the debt the homeowner owes. In some cases, the bank may try to recover this debt by selling the property at auction. In other cases, the bank will simply list the foreclosed home for sale.

Choosing to purchase a foreclosed home has both advantages and disadvantages for the buyer. Weighing these advantages and disadvantages carefully is essential.

Pros of Buying a Foreclosure

When you decide to buy a foreclosure, you will be working with a seller that is inherently more motivated. The longer the bank owns the property, the more money they lose. For this reason, banks are often more willing to negotiate on all of the terms of the sale, including the price, closing costs and other important factors.

Buying a foreclosure also ensures that you are getting a house that is already vacant, so you can move in whenever you are ready. In addition, you can be sure that the title on the home is clear.

In most cases, you will be able to finance a bank-owned foreclosure with a mortgage, and you will be able to obtain an inspection if you want one.

Cons of Buying a Foreclosure

Buying a foreclosure also comes with disadvantages. For example, banks usually require additional paperwork when you are purchasing a foreclosed home.

In addition, most banks will refuse to complete any repairs on the home before the purchase. Most foreclosed homes are sold as-is, which means you may have to repair some problems or do some updates after you buy the home.

Finally, because the bank has only owned the home a short time, they cannot provide comprehensive disclosures related to the property’s current condition or history. This means that you may end up purchasing a home without being fully aware of the problems you’ll need to address.

Making a Choice

Buying a foreclosure isn’t the right option for every buyer. However, if you are a careful shopper, potential benefits are available.

Before making an offer on a foreclosed home, be sure to consult an experienced mortgage professional to get your pre-approval in order so you can complete the purchase quickly if you choose to move forward.

For More Info Visit: http://www.bondstreetloans.com

Latest Blog Posts

6 Metrics You Must Know To Identify Great Investments

biggerpockets.com/Billionaire Andrew Carnegie famously said that 90 percent of millionaires got their wealth by investing in real estate.While this is true historically, we seem to have reached a

Read More

How AI Will Enter The Real Estate Market And Accurately Predict Future Property Appreciation Values

Technology continues to disrupt the residential real estate industry at a rapid pace. In 2020, it’s becoming more and more necessary for brokers to utilize technology and artificial intelligence

Read More

December NJ Real Estate Market Stats Are In

In 2019 home prices were up again in most markets. Buyer demand continues to be strong but with tepid seller activity still in many locations, total sales are lower than they would normally be in a

Read More

2020 Home Improvement Projects With The Highest ROI

Curb appeal really does have a major impact on the return you'll see at resale. Among the top 10 home improvement projects with the highest return on investment (ROI) in Remodeling magazine's

Read More