If you’re looking to buy a foreclosure property, the following information will help you navigate the waters.
A foreclosure is any property that is in the process of being taken back by the lender. A short sale is when a borrower is selling a property for less than is owed on it.
A real estate-owned (REO) property means that the foreclosure process has been completed and the bank owns the property outright.
These days, the market is full of the aforementioned properties. If you’re looking to buy one, find yourself a good real estate agent who has worked with these before.
While prices for these types of properties are often lower than comparable non-foreclosure properties, keep in mind that the process of purchasing one can be more drawn out than it is when buying a property via conventional channels.
Lenders must approve the sales, and with the volume that many are carrying, it may take weeks to hear if an offer is even accepted. Because there are so many undervalued properties, there may be many bids on each, driving up the price in a bidding war.
Financing a foreclosure is pretty much the same process as financing a traditionally purchased property. The purchase process may be slow at the beginning, but after an offer is accepted many lenders want to close quickly, often within weeks, to get the properties off their books.