Homeowners will have a chance to make payments arrangement but they’ll need to try hard to come up with payments in a reasonable time. If the house is foreclosed, the lender will put it up for auction and this is available to the public. Usually there’ll be an auction for it and you can look up the listing of the places in magazines or online. You have to show up at the auction and make your bid. You’ll also need to do research on the home price and its condition. You’ll also need to know the area well to see if you want to live there because some homes can be in high crimes area. There’re homes that are foreclosed in good neighborhood too. If you want to buy a foreclosed home, you’ll need to research for listings of foreclosed home. You need to get right into it or else you can miss your chance. Lenders are eager to sell foreclosed home to you and you can get a lower rate on it. You should make negotiations for lower fees and interest rate when buying a foreclosed home.
There’re advantages to buying foreclosed home such as low interest rate, low closing costs, and lowered home price. Investors usually will take advantage of foreclosed homes. Most foreclosed home price can be sold at 5% lower than its market value and this is the saving that buyer will get. It doesn’t get as low as 30-40% like you would think. You can find listing of foreclosed homes at local foreclosure law since lenders will file the lawsuit for foreclosing in some states. States like California and Texas do not require a judicial process for foreclosure. Florida, New York, Ohio and Pennsylvania require the lender to file a lawsuit against the home owner in order to foreclosed the house. You can find listings at major banks like Nationwide, BOA, and Chase mortgage. You can find listing by driving through your town. You can find listing at major auction houses likeReal Estate Disposition Corporation, J.P. King, United Country Auction Services, Williams & Williams, and Bid4Assets.
The auction will take place at a county court and you might not be able to see the house for yourself. This is one disadvantage to the auction process. The home price will be according to the balance that is owned by the current owner. There will be many other laws that will affect the listed foreclosed price such as current bankruptcy law. If no one bids on the foreclosed home then it’ll become an REO or real estate own by the lender. The lender will take the home into its inventories.
When you’re buying a foreclosed home, there’ll be home defects due to the lack of care of the previous owner. There might not be water, or electricity available. The roof might be in a bad condition. When you have good credit, the lender will give you a loan for the foreclosed home. You’ll be required to put 10% down if the foreclosed home is for rental. You can also loan from your home equity if you owned another home. Foreclosed home is a good option for investors in a down stock market. They can get a higher return later on when the real estate price increased on the home they purchased.
Source: http://articles.moneycentral.m sn.com/Investing/RealEstate/Th eSafestWaysToBuyForeclosures.a spx?page=1