Buying a Foreclosure
Buying a Foreclosure
Buying a foreclosed home is not the easiest real estate purchase you can make. That said, the rewards for enduring the process might be worth the effort required. There are certainly deals to be found when looking at foreclosure listings. Most buyers will have lots of questions for their Summit NJ real estate agent when they are considering buying a foreclosed home.
What is a foreclosure?
Foreclosure occurs when a home owner is unable to pay his mortgage. The lender takes possession of the home and attempts to recoup as much of its losses as possible. The selling price may be significantly lower than the actual value of the home.
What help will I need?
A Summit NJ real estate agent who is experienced in dealing with foreclosures will be a huge help to you in this process. You may also need the assistance of a real estate attorney. This is not a process to take on alone unless you have a great deal of experience in these matters.
Where do I find one?
There are websites and magazines dedicated to foreclosure listings. Government agencies like Fannie Mae and HUD advertise foreclosure listings on their websites. An industrious buyer can also look through public records for the notice of default that a lender must file at the county clerk’s office.
What should I do?
Do the leg work on the property. Tour it yourself and get an inspection. Don’t rely on old data. Foreclosures are sold “as is” so be sure you know what you’re buying. Take the initiative and pay for your own inspection. Check everything, especially if the property has been unoccupied. Test the pipes for leaks from freezing, all the electrical outlets and switches and every other little detail. Make no assumption of good condition. Have your agent check the comps to see if the property really is the deal you think it is. Check for liens and taxes against the home and find out what your liability will be for those costs. Don’t go into this purchase without knowing every detail.
What should I expect?
Expect paperwork, lots of paperwork. Buying a foreclosed home may take more time than a typical home purchase. Be prepared for a no-negotiation situation. The lender is trying to minimize their losses so there will be no concessions and no bargaining. Be prepared to pay for any and all repairs needed on the property.
Buying a foreclosure isn’t easy; it takes work. But if you can find a great deal in a down economy, it will be worth your time and effort.