Thursday, 17 April 2014 21:26

Purchasing a Foreclosed Home

Are you willing to roll the dice?

There are homes for sale in chatham IL that are in foreclosure. Purchasing a home during foreclosure must go according to a plan. If the home you want is in foreclosure, it can be yours. The best way to obtain it would be to learn more about it. There are three stages of foreclosure: pre-foreclosure, auction, and post-foreclosure.

Pre-Foreclosure

During this stage, the homeowner still owns the property. They know foreclosure is coming and time is running out. Buyers are going to have a hard time getting a home in this stage. The owner of the home is going through the transition from homeowner to lender/bank. The trick here is to work fast. Homeowners may have the chance to perform a short sale and sell it to you before foreclosure comes. The lender/bank has to be open to it, however. More than likely the lender/bank wants to work a completely new deal out with the buyer.

Auction

This is when the home is up for auction. There is no owner at this point. Be careful about being the owner at this stage. You are competition with the owner, the bank and several other buyers and investors for the same house. If you win the bid, the home is yours as soon as the monetary transaction is complete. Sales are final and no refunds are given. You won't have time to do background checks such as title searches and home inspections because you'll be the owner of the home now. By the time you do, there's so much risk on the home that it's going to be tough sorting it out or selling it to someone else.

Post-Foreclosure

The lender/bank owns the home at this point. They won the auction and now they want to recoup their lost finances. They are going after the outstanding balance owed on the property. You will have to make a deal with the bank to own the home. Banks are willing to work with buyers to sell the home as quickly as possible. Banks/lenders are selling the home "as is." It's vital that you research the home thoroughly. Be aware that now-former owners are trying to buy back the home as well even though they lost out.

What you need to do is research the home before making a move. Figure out what stage the home is in and learn everything you can about its financial state. The same buyer rules (price, inspections, title search, examining the home in person, etc) apply for foreclosure too. While you should act quickly in some situations never jump into a situation you not completely confident; you will end up in buyer's remorse.

It's not advisable to venture out on your own. Too many things can go wrong. An experienced realtor must help you purchase the home with the least amount of detours. An optional option is having a real estate attorney by your side. Contact us for more information.

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