Buying Foreclosures
If you are looking to purchase a foreclosure either as your new home or as an investment property - look no further. We have access to a database of hundreds of thousands of foreclosed properties in the Massachusetts area. The best part is - it's at no cost to you! Contact us today to learn more.
What You Need to Know
Most people know that buying foreclosures can be a great way to purchase a home way below market value. But the reward doesn't come without risk. Some buyers enter the foreclosure market unprepared and learn this the hard way. Like everything, buying a foreclosed home has its pros and cons, all of which are discussed below.
Advantages
- The main advantage of buying a foreclosure is of course the price. Foreclosures sell for anywhere between 10% and 50% below their market value.
- Foreclosed homes are often 'fixer uppers'. If you are willing to invest some sweat equity in to fixing up the property, you may be able to make a substantial profit upon resale. However, it is imperative that you consider the total amount of money needed to fix it up and research how much you can then sell it for when deciding on your bidding price.
- Banks want to dispose of these foreclosures in a hurry. Therefore, they are often willing to accept lower offers on down payments, closing costs, and all the other miscellaneous costs associated with buying a home. They can also offer very flexible financing terms get the deal done.
Disadvantages
- Most of these homes are purchased 'as is' from the lender, meaning there is no guarantee of the condition. More often that not, it is impossible to inspect the property before making a bid. When a seller knows they are going to lose their home, they may stop caring for it. This means you could find the home in very poor condition, so be prepared.
- If there are tenants or squatters in the home, it is your responsibility to get rid of them, which could mean having to evict them. We recommend you hire an attorney if you are not familiar with the eviction process.
- Foreclosures involve a lot more paperwork and require you to exercise more caution than you would in a regular real estate transaction.
- There may be liens against the property due to unpaid taxes that can increase the hassle, cost and paperwork.
All the above disadvantages are manageable and can be avoided with a little research. Buying foreclosures is a science and not for the faint of heart (otherwise everyone would be doing it). It is best handled by the pros, so please put us professionals to work for you!
