Foreclosure Bargains Are Not Always Lucky Deals Without Risks

January 29th, 2008

With real estate prices tumbling because of the foreclosure crisis there is a hurry and scurry to try one’s fortune and pick up a deal. But there is a catch. Not all bargains turn out to be lucky.

The apparent low price does not speak of the actual value of the foreclosed house. It may need a tidy packet to be put back on its rails. A point to remember is that those struggling with foreclosure do not care to look after the maintenance of the unit. Rather there is a tendency to vandalize and vent one’s anger by selling off appliances and fixtures. Some just strip it off. Even if the evicted owners do not cause this there are others to pitch in. Nature hates a vacuum. Damp, cobwebs, rats, stinking mosquito ridden pools with frogs and snakes as well as overgrown weeds and grass can create slow but sure havoc. To cap it all are the faceless human destroyers – criminal gangs, drug peddlers and takers as well as prostitutes complete the picture.

In the present scenario of foreclosures dominating the scene a new business group has cropped up who sell the lists of bank owned houses. One such organization charges $50 per month, after a trial offer of a week, to gain access to particulars about 650,000 houses in or about to foreclose right across the country.

There are other options of finding out the details for banks hire real estate agents to enlist their properties in MLS or multiple listing services. Any agent of the MLS can find out about foreclosure, pre-foreclosure properties or those being offered as short sale. In the latter case of short sale the bank agrees to the sale even though the amount to be got from it is less than the loan amount.

Considering all these it is best for the buyer of foreclosed property to insist on professional inspection. Another warning is not to buy a foreclosed unit without agreeing to optional title insurance policy. This will give protection in case unpaid contractors or the like pop up after the closing of the deal.

The best quality needed to make a foreclosure deal worth it, is to be patient. It may take weeks to coax a response but more often than not the waiting might be worth it – if all precautions are taken.