subject: Before You Purchase Foreclosed Homes, Know The Basics [print this page] Homes in foreclosure can provide great opportunities to acquire prime properties at discounted prices. Whether you are a homebuyer looking for a new home or an investor seeking profitable investment, it is very important that you have a significant understanding of the real estate market. Here are some of the basic things that you should know when you purchase foreclosed homes.What is a foreclosure?A foreclosure is a legal process in which a lender takes legal action when the borrower fails to meet the terms of the mortgage or trust deed. A borrower is considered in default when the repayment terms in the mortgage or trust deed are not fulfilled.It is important for you to know that foreclosure is not a single isolated event. It is an ongoing process that culminates in the repossession of the property. The general phases of foreclosures are: pre-foreclosure, auction sale, redemption period, and finally the post foreclosure phase. It is equally important that you have a substantial understanding of foreclosure laws in your State to gain a better understanding of the foreclosure process.How to Purchase Foreclosed HomesWhen purchasing foreclosed homes, the first step that you should do is to find your target area. Things to consider include the job market, schools in the area, crime statistics and the overall environment. The second step is to find a foreclosed home that fits your criteria. Foreclosed properties can be found by searching through foreclosed listings, newspapers, public auctions, banks and lending companies. The Internet is a valuable tool that you can use to find foreclosed homes. The third step is financing. You should determine how you will finance the foreclosed home. A lender with expertise in the real estate market can guide a homebuyer through the process and avoid any potential pitfalls.Remember, when you purchase foreclosed homes it is imperative that you research the market value of the home, inspect the property, and perform a title search to make sure there are no liens or loans attached to the property. Having as much information as possible on the foreclosed home is the key to having a successful foreclosure deal.
