Guide to Buying Home Foreclosures

March 20, 2010 by · Leave a Comment 

Whether you're a relocating family or an investor looking to make money flipping homes, Central Florida foreclosures deserve your attention…especially the homes in Downtown Orlando. Buying a foreclosed home will afford you the freedom to make lovely interior adjustments, colorful landscaping upgrades, and a variety of other property embellishments.

What is a Foreclosure? A foreclosure occurs when a homeowner is unable to pay their mortgage. Because of this delinquency, the mortgage lender (bank) assumes full ownership of the home. This bank-owned home is referred to as a "foreclosed home".

If you are considering buying a foreclosed home in Central Florida, examine the following:

•    Understand the Advantages: Lenders want to recover the unpaid amount of the home's mortgage as soon as possible. As a result, many foreclosed homes are sold at significantly discounted prices. Sometimes, a foreclosed homes will sell for 30-40% of its market worth.

•    Inspect the Property: Some foreclosures are left in a state of disrepair. This is not necessarily a bad thing. Just make sure that the cost of the repairs will be be overshadowed by the value that they will add to the home.

•    Find an Experienced Agent: Buying a foreclosed home requires a specific body of knowledge and expertise. Find a real estate agent that is well-versed in the foreclosure market. Furthermore, some banks won't even sell to unrepresented buyers.

•    Know Your Credit Score: Examine your credit report. Make sure to correct any outdated information or previous defaults.

•    Understand Property Liens: Find out if the foreclosed property is attached to an liens; most notably, unpaid property taxes. If liens exist, find out who is responsible for them.

•    Paperwork: When purchasing a foreclosed home, expect more paperwork. Buying a home from a bank or government agency is a much more rigid process than buying from a real estate agency or directly from homeowner.

•    Compare: Compare the costs and advantages of a foreclosed home with other foreclosures and other new properties. Cross-analyze the cost of any estimated repairs with the discounted home price.

Once you've examined the pros and cons of purchasing a foreclosed home, then get ready for the thrilling sensation of owning a new home.

About Mike

Mid Florida Investment Properties, LLC owner Mike Calvert has been buying and selling real estate in Central Florida for over 10 years. Get a seasoned investor as your partner for a fraction of the profit. We handle the transaction from start to finish!

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