Hi I’m Anthony Lamacchia of McGeough Lamacchia Realty.
In this video we are going to talk about Buying a Foreclosure.
Buying a foreclosure can be a great way to get a great deal but there are a number of things to look out for. One major misconception out there is that you can buy a foreclosed home for an enormous discount. Some people even think you can buy these homes for half of what they are worth. They do sell at discounts but many times it is because the house fell into disrepair because they were neglected in the last year or two while the previous owners were running out of money. And when homes are left vacant things begin to deteriorate very quickly. As an example, up here in New England a common problem with foreclosures is frozen and broken pipes.
It is also extremely important to hire a good experienced buyer’s agent when buying a foreclosure. Listing agents for these properties usually do not know much at all about the home because they did not speak to the previous owners. That means that buyers agent’s will not be able to obtain too much property specific information either but they will be able to help you know what to expect and navigate through this. In addition to that the banks who own these properties are never willing to negotiate their purchase contracts. If you do want to buy a foreclosure then you need to be more tolerant of not being able to negotiate anything other than the purchase price.
It is also important to conduct a home inspection so that you are aware of any issues that the home may have. But make sure you are prepared to accept the fact that the bank will most likely not fix anything because these properties are being sold as is. This is not a bad thing as long as you are prepared to make some repairs once you own the property.
Lastly when buying a foreclosure make sure you have a very good real estate attorney working for you who will check the title very closely. Remember these robo signing lawsuits have happened because of poor documenting and improper recording by big banks. The last thing you want to do is buy one of these properties that has some sort of title defect that involves the foreclosure. For additional coverage make sure you purchase owners title insurance in addition to mortgage title insurance just in case something comes up with the title later.
To conclude we want to be clear that buying a foreclosure can be a good buy but you need to be sure to do your homework.
That is it for buying a foreclosure thanks very much for watching!
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