Property investors have been purchasing homes from sales of distressed properties for some time now. They are reaping in huge profits from reselling these properties back to the market with a significant mark up. People planning to relocate to another place have also done so with ease and economy by purchasing foreclosed homes. Indeed it is all the buzz in the real estate industry.
But prospective buyers of homes from sales of distressed properties need to practice a good amount of caution. They should also conduct solid research to be able to better determine if a certain home is really worth their investment. There are a handful of basic information on foreclosures that every buyer should be in possession of before they venture into this type of investment.
The Types of Foreclosures
There are different types of foreclosure sales all with the end of recouping losses from mortgage defaults. Of equal popularity are the home auction and the sale of real estate owned homes. Home auctions are scheduled after the process of foreclosure is made final. Participants are asked to pay a certain fee to register and participate. The winning bidder has as short as two weeks to make cash settlement for the property. Homes sold at auctions are not open for inspection so it would be a good idea to drive down the address and check out the property as well as the neighborhood where it is located.
Real estate owned properties are sold by the lenders who carried out the foreclosure. These are usually sold through appointed real estate brokers or agents. Buyers can transact with these realtors to make an offer for the property. This offer can either be accepted or returned with a counter-offer and buyers can still make another offer based on the lender's counter offer.
While there are real bargains to be gained through sales of distressed properties, it can only happen with the buyer's involvement.