You just saw this beautiful house on your way to work. After browsing online listings for months, you finally found the house that you feel will be the perfect fit for your family. While there is a “For Sale” sign in the front yard, you can’t seem to find the owner’s or agent’s number. You contact your Orlando buyer’s agent to ask about the property and learn that the home is in foreclosure.
Before you go into panic mode, let me tell you that you can still buy this house.
Yes, it’s completely possible but there are a few things that you need to consider. We will get to them in a bit.
Understanding a Foreclosure
For those of you who don’t know what a foreclosure is, here’s a simple explanation:
“A foreclosure is a home that was once owned by a person but now is in the custody of a bank.”
The house was either voluntarily given by the homeowner or the bank confiscated it due to delayed payments. Even though the house is in the bank’s possession, it doesn’t mean that they own it. Instead of contacting the seller, you will have to contact the bank to make the purchase.
Now, let’s have a look at a few factors of foreclosures so that you can make a smart and successful purchase:
1. Too Many Problems with the House
A house that has been in foreclosure might look good from the outside but its hiding too many repairs. Lack of cleanliness, bad renovations, water damage, overgrown grounds, shoddy electrical work, and infestation are just some of the things you need to worry about. You will have to visit the property and get a home inspection to find out the full extent of the damage and repairs required.
2. No Room for Negotiations on Repairs
As mentioned earlier, the house is now owned by the bank and they do not enter into negotiations. What you see is what you get – that’s how foreclosures are sold. The home inspection will help you calculate a budget that you will need for the repairs and that’s it. You will not be receiving any deals from the homeowner.
3. You Can Negotiate on the Sale Price
One of the best things about foreclosures is that they are competitively priced. You will find them in a much lower range compared to other houses, not under foreclosure, on the block. This is where you can haggle with the bank by asking them to lower the down payment or the sale price.
4. You, Will, Have Trouble Finding a Loan
Banks want to sell a foreclosure as soon as they can. The longer the house sits on the market, the more money they lose. This is why it is important to get your finances in order before making an offer. Moreover, make sure that your credit score is slightly above the “good” range so that you can get a loan.
5. Getting the Deed in Your Name Will Take Some Time
Since the house is in the bank’s possession, you will be dealing with a business entity and not a homeowner. There will be a lot of red tape involved, which will delay the closing of the house. So be patient.
And now you know what you are in store for when buying a foreclosure. The good news is that the transaction can be a lot smoother with a Sanford Florida realtor by your side. If you are planning to look into Orlando real estate, then visit the website Megan Dowdy Realty. For further information, call on 407-509-9279.
