How Do I Buy?

It is important to be aware that buying property in foreclosure is a risky venture. Most foreclosed properties are sold "as is" and there can be problems not only with the structure, but there may also be liens on the property, unpaid taxes, and other problems to deal with. If you are not experienced in real estate, you should be very cautious before getting involved with purchasing foreclosed properties. That being said, buying foreclosure properties can be very rewarding and profitable if you are careful and thorough.

The first step will be to familiarize yourself with the applicable laws and the process in your area. Once you understand this, you will next want to start identifying geographical areas in which you would like to purchase a property. Once you determine the areas you are interested in, you will want to begin locating properties that are in the foreclosure process. There are a number of different ways to do this, including checking the classified ads in your local newspaper. Foreclosure properties may be listed several different ways, such as under "Foreclosure Sales", or "Sheriff's Sales". You can also learn about properties if the lender is giving notice to the borrower of the lender's intention to initiate foreclosure proceedings.

Other ways of learning about foreclosure properties include commercial databases, the number of which has greatly expanded in recent years. If you are using a commercial database of foreclosure properties, it is best to make sure that there are many pre-foreclosure properties listed, as these will typically be the best bargains. Interested parties may also check with the County Recorder's Office, and it may be possible to get information from the applicable court in some areas. Another way to obtain information is through the banks or other lending institutions that hold the mortgages, or through government agencies such as the Federal Housing Administration, the Department of Housing and Urban Development (HUD), or the Veterans Administration.

After you learn about the properties in foreclosure in your area, the next step is to inspect the properties you are interested in, if possible. Sometimes you will not be able to inspect the property ahead of time. You will then want to determine the value of comparable properties in the same area. This information can be obtained with help from Sage Allen Real Estate. If you are still interested in the property at this point, the next step will be to find out who owns the property, and what liens encumber the property. Find out the balance in default to the lender, and the balance remaining on the loan that has resulted in the foreclosure proceeding.

You will want to find out if back taxes are owed on the real estate. To determine this information you will want to conduct a full title search. Finally, you should make sure you are familiar with any land zoning, easement or toxic waste issues that could impact your use of the property. Also make sure there are no pest problems, other structural problems, and determine if any illegal alterations have been made to the property without the necessary permits. Once you know exactly what you are facing, how you will proceed will depend on what type of sale is taking place. Below is a complimentary Foreclosure Search Tool if you are ready to begin your search.