What You Need to Know About Buying a Foreclosure at Auction
By Joshua Martindale
If you are looking for a good deal on a house, buying a foreclosure at auction is something you should consider. Whenever a homeowner is no longer able to pay for a home, the mortgage company takes possession of the home. Sometimes, in order to recoup some of the money that was lost, the bank will sell the house at an affordable price at a government auction.
There are many advantages to buying a foreclosed home. For starters, you will save a lot of money. Instead of going through all of the trouble to obtaining a mortgage for a new home, why not buy one at an auction? According to statistics, the average home buyer saves up to 40% when buying a foreclosed house or property.
You can profit from buying foreclosed property as well. If you do not want to live in the home yourself, you can rent it out for income. The rent money you receive each month can help you pay your own mortgage on a newer home. You could also fix the foreclosed home up and sell it for a huge profit!
At least some good is coming out of the depressing economy. With all of the home foreclosures these past few years, it is nice to know that there are still ways to make money. Even if you are unsure about buying a foreclosure at auction, you can still check out some of the homes for sale.
You can obtain a schedule of upcoming auctions by looking through your local newspaper listings or on the internet. Sometimes notifications are listed in newspapers whenever a home is foreclosed. If you find a home you are interested in, notify real estate agents and attorneys in your area. You can learn more about the home.
Before buying any property, however, bring an inspector with you. Inspect the property to ensure that it is in good condition. Sometimes, when people find out that they are about to lose their homes, they will make a mess before they leave or remove all the appliances. Make sure this has not happened to the house you want to buy. Many foreclosed homes are sold “as is” for this very reason.
In addition to inspecting the property, you should also determine the ownership. Make absolutely certain that there are no existing liens on the house. Conduct a title search just in case there are any ownership problems. You don’t want to spend money on a foreclosed home only to find out that there is a lien or judgment on it.
Determine how you are going to finance the property. Is the current loan assumable? Will you have to pay cash? Will you be able to pay with credit? Different jurisdictions have different laws in regards to purchasing foreclosures at auctions. Since the legal proceedings can be confusing, make sure you are able to grasp at least the basics before going forward with your purchase.
Are you interested in Florida real estate? If you want to learn about the Florida market quickly, be sure to visit my St. Augustine real estate blog and my Daytona Beach real estate blog for more information.
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Northern Virginia Real Estate