Should you Buy a Foreclosure?

A foreclosure is the legal process of a mortgage company taking possession of a homeowner's home if they stop making payments. You may have heard people talking about buying foreclosure homes, but you're not sure what that means. There are pros and cons to to purchasing a foreclosure.

Before becoming a real estate agent, I was actually a legal assistant for a law firm specializing in foreclosure for almost 7 years. When I became a real estate agent, I was very excited to move to a more positive side of the real estate industry. However, even as an agent, "foreclosure" is still a word I hear in my career.

Why would anyone want to buy a foreclosure home instead of a home sold by the homeowner? You can sometimes get really good deals when buying a foreclosure. These homes often need work, sometimes extensively. If you're willing to put the work in, you can get a home under normal market value.

There are two options for purchasing a foreclosure - through auction or buying directly from the bank once they have taken possession. When a home goes through the foreclosure process, it is first available to bid on through an auction. If no one buys the home at the auction, the bank takes possession of it and will list it for sale. When the bank lists the home for sale, these are called REO homes, or Real Estate Owned homes.io

What are the differences between purchasing the home at the auction or directly from the bank? The main differences are - when you purchase in an auction, you may get the home for a much lower price, but you do not get to see the inside of the home before you buy. This is very risky since you do not know the condition of the home and how much work it will need. However, you may be able to get a really good deal. When you purchase a home from the bank, you get to view the home and complete an inspection just as you would with any other home. However, you will pay closer to market value than if you purchased at auction. There is much less risk this way, but you will probably not get as much of a deal.

If you have any questions about foreclosures or are interested in purchasing one, reach out to me! I would be happy to answer any of your questions or help you find your new home!

Angel Kimmel

Realtopia Real Estate

815-546-3146

angel@realtopiaRE.com

AngelTheAgent.com