With over a million foreclosures in the United States at some stage or the other, a number of deals can be taken advantage of.
However, one must be able to discern the potential for a good bargain and thus, separate the proverbial wheat from the chaff.
So, if your next question is how does one do this, here are 5 steps that smart foreclosure buyers can keep in mind:
#1: Think about REOs if you’re a beginner
If you’re a novice, then it’s a good idea to stay away from auctions or even short sales but only on real estate owned properties instead. The reason for this is that the first two are very complex while the REOs are similar to traditional home sales. Yet most of all, they offer the lowest prices of all even if being in poor condition.
#2: Set up financing in advance
Since REOs attract multiple offers by a number of people, financing should be set up in advance. Simply put, get a pre-approved loan before even going out to look at properties. Check your credit, get some cash for a downpayment too.
#3: Inspect the properties carefully
One way to get the best deal as a foreclosure buyer is to get the property properly inspected. This will give you an accurate run down of the problems and the costs involved in fixing them.
#4: Research your Market
It is imperative for you to study a number of factors before making any purchases. Some of them include how much these properties are going for, how fast they’re moving as well as how much will a distressed home’s value rise.
#5: Hire an excellent buyers agent
Finding an experienced buyers agent, especially with foreclosures, can simplify your work for you. Not only can you take classes offered by the National Association of Realtors but also look through the Charfen Institute and RealtyTrac databases for agents that have expertise in distressed deals.