subject: Buying Distressed Properties: What You Need To Know [print this page] It may be hard to make good off of someone elses misfortune, however, when it comes to buying a foreclosed home, or distressed properties, its just business. Admit it, youve seen, or at least heard of programs featuring folks buying dirt cheap, then taking on the giant do-it-yourself project of flipping such homes. This is probably most peoples exposure to what distressed properties may represent. In reality, they can be a great opportunity, but dont be razzle-dazzled with dreams of an easy deal.
Before jumping into such a prospect, there are a few things to get acquainted with. First of all, distressed home sales can be complicated and the sellers still have some rights. Get good legal advice before entering in to any contract.
How your buying process goes depends on your method of purchase. You may be negotiating a short sale, or you could be negotiating directly with the seller in foreclosure if the home goes to public auction, you will be bidding.
Short sale: This is when the sellers lender is willing to accept an offer below value to release an existing mortgage. In this case, the seller may say yes, but the lender may not accept the discounted offer. Be aware that you may see ridiculously low pricing on a short sale home, but this doesnt mean the lender will go along with that price, and it may receive numerous offers. You will likely need to make an offer closer to market value in these cases. Be sure to have your realtor conduct extensive research on the home. They will need to look into how much is owed on the home and if there is more than one loan on it. Also have them find out whether or not the listing agent has received the mandatory complete short-sale package from the seller.
Buying a foreclosure: Here is where youll want to act quickly, but thoughtfully. In Georgia, there may be as little as 60 days from the notice of default, until a property is sold at auction. This is also the case where you need to be tough enough to take advantage of anothers misfortune, or possibly put a family out on the street. Experts however, prefer to pounce on these properties before the foreclosure proceedings are final. Once an acceptable offer is made, you can breathe easy. Georgia has no statutory right of redemption. This means that once a deed under power of sale is issued to a successful bidder at a foreclosure sale, the party foreclosed on cannot get their property back by making payment on what they owe in full.
Being informed is the key. Purchasing a distressed property should not be taken lightly, as there are many issues that need to be settled. A good realtor will know what research to do, and can take you through the complicated proceedings. In the end, you could wind up with a very good deal on a home.
Do you have a particular North Metro Atlanta property in mind? Contact us and we can help you find one, and take you through the process.
