Are you in the market for a new home? There are plenty of options when it comes to foreclosures. By choosing this route, you could end up saving some money. When a property is foreclosed, it means the owner failed to pay their mortgage payments. At this point, the lender would seek a lawyer to begin the process of foreclosure to take over ownership, sell the property and make back their capital gain. The foreclosure process is vastly different than purchasing a home through the home-owner or realtor.
Purchasing a foreclosure is a unique process and one that requires education for the prospective buyer. The first step when looking to purchase a bank owned home is to find one that you like. However, it’s important to keep in mind that the home will be sold in its current condition. With that being said, you can expect to receive a decent discount on the mortgage price saving you money to put towards other expenses, such as renovations, furniture or even towards non-property related splurges, such as travel.
Once you’ve decided on a property, you’ll submit your offer through an agent. The agent then takes that offer and brings it to the bank or lawyer who will review your bid and decide whether you are a suitable candidate to view the home with the intent of purchase. During this process, the Buyer is able to complete all of their due diligence (such a home inspection, etc) then can submit a deposit. After this step is complete a hearing date is set – all offers are submitted without any realtors or buyers present. The court will then decide on one, almost always an unconditional one and the deal is done!
If a home is in a state of pre-foreclosure, that means the initial owner still has a chance to stop the process. They can either choose to pay off their remaining debt and keep their home or they can decide to sell the property. If you’re interested in a property that is in this state, it’s best to reach out to the owner as soon as possible. There’s a good chance that they are weighing out their options. By making them an offer, it could speed up the process by convincing them to sell. Please keep in mind that the process of pre-foreclosure is a lengthy one, so you may not hear back from the owner right away.
The process of purchasing a foreclosure is unique. You want to ensure you are informed of each step before deciding to buy a bank owned property so there are no surprises along the way. Rather than just working with a realtor and placing an offer on a home you like, there are a variety of steps that come with purchasing a foreclosure along with a lengthier waiting period. If you feel the savings of buying a bank owned home is a benefit for you and your family and would like more information, fill out the contact form below and someone will be in contact soon.