Should You Buy a Foreclosure?

Rising foreclosures (default notices, scheduled auctions, and bank repossessions) spell some opportunity, but today’s REOs (real estate owned, but literally: lender-owned) aren’t the bargains they were during the Great Recession. In 2008, REOs rose to over 2.3 million units, while today there are only about 380,000 units.

You’ll have fewer choices, more competition, and less desperate pricing, so here’s what you should know:

• REOs are typically sold “as is”, meaning no repairs.
• Some REOs can’t have home inspections.
• Renovations and repairs may be costly.
• You may pay some or all of the seller’s closing costs.
• Any liens on the property will fall to you to pay.
• REO auctions often require a hefty deposit then payment in full by certified check or cash.

There are several ways to find foreclosed properties and upcoming auctions.

• The county tax assessor, or county sheriff’s office.
• HUDforeclosed.com
• Buying a HUD home from the government. You’ll need to hire a HUD-certified real estate broker and a HUD-certified lender. To browse for homes, click here.

Further questions? Ask Jane At The Lake for assistance.