Buying foreclosed homes can save a lot of money but you need to understand exactly what you're getting into. You will find some differences when you buy a foreclosed home rather than a traditional sales. We are going to highlight some of those differences now.
Most of the time people are compulsive when they buy a home. They find a home first and then go looking for the financing. When you buy a home that has been foreclosed on then you want to already be pre-approved for your financing first. After you locate the home you are going to purchase, there will be little room for any price negotiations.
You might have to look at many houses before finding the one you really want. It can be difficult and a grind because you have to consider several offers until you get down to the one that is acceptable, but if things go the right way you can save yourself lots of money and that makes the effort worthwhile.
When you buy a foreclosed home you have several things you need to happen, and all of these should happen around the same time. First you want to locate a real estate broker who works along with banks and sells foreclosed homes. You want to get a pre-approval letter from the lender. You also need to make yourself familiar with the prices of similar homes in that specific area that you are buying in.
To find out what's available you have the option of viewing a whole database full of foreclosed homes for that area. You might be able to just login to a particular real estate website within your area and filter out just the foreclosed homes. Whenever you see 'REO' it means 'real estate owned' and lets you know that the bank owns it.
From here when looking through the homes list you are trying to find an agent, not a particular house. The banks will usually hire just one or two brokers that they entrust to handle selling their REO homes. You want to find out who they are. By using just one broker it means their commission won't have to be divided.
Brokers who work for banks have listing that aren't public yet. Whenever you talk to them be sure to ask about their newest listings. The way to let them know you're serious is to obtain your pre-approval letter from your lender before going further with your broker. The good deals usually go quickly and you want to make sure you are prepared to move and have the financing needed when the house you are after comes available.
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