If you are currently in the market to purchase a home, you will inevitably come across a wide variety of homes. Some may be move in ready, some may need a little work, others may need a lot of work. Most foreclosed homes will require a lot of work to be livable and to your liking. However, if you know in advance what to expect from foreclosed homes on the market, you can find a great deal.
Foreclosures across the nation have skyrocketed in the past few years. A poor economy and bad lending practices are to blame. However, this can be to the homebuyer’s advantage. Most foreclosed homes are priced significantly less than their comparable real estate owned counterparts. In many instances, a foreclosed home may be price below 50% of its true market value. This qualifies as a great deal. But don’t expect a foreclosed home to be move in ready.
What should you expect to find with foreclosed homes? Remember that most previous owners were forced out and sometimes in a hurry. Banks that foreclose on the home will come in and clean up messes and trash left behind. They will also padlock all doors, which will usually destroy the doors or at least require replacement locks. Beyond the obvious, expect the house in general to be dirty, perhaps smell from mold or mildew within the home, expect toilets and bathtubs to look awful from lack of use. There may be water damage from frozen pipes and so on. This is expected with foreclosed homes as they stand vacant for months or even years.
You will also encounter some things that are unexpected. There may be signs of vandalism. You could experience critters living in and around the home and perhaps holes in the walls from previous owner haste fully removing light fixtures, shelves, pictures, etc… Don’t be discouraged at first sight. Much of the damage is easily fixed and does not cost you a lot of money.
All of the photos included in this article are real examples of one foreclosed home purchased by a friend of mine. This home is indicative of what you can expect with a good example of a foreclosed home. I spent several months inside similar foreclosed homes when searching the market for a house with a friend. This is certainly a good example on the market, others were significantly worse.
Many foreclosed homes on the market will be in need of small general repairs and updates. You will likely experience homes with wild paint schemes, old flooring, outdated kitchens, bathrooms in need of renovation and so on. When you enter a foreclosed home, make note of what is needed and try to calculate the cost of the repairs. This will either confirm or deny if the house is truly a bargain or steal at the price that it is listed on the market.
If repairs are extensive, you need to account for the time needed to finish repairs before moving in and determine if you have the amount of time to wait for the projects completion. If time is short and you can not wait to move in, than repairs may have to wait. Extensive repairs to a home that you are living in are much more difficult and stressful then repairing a vacant home. Evaluate whether or not you are willing to live in a house that needs repair or if you desire to chose a house that needs minor repairs that can be completed before your move in date.
A foreclosed home can and will save you money, but you need to know what you are getting into. You need to access the entire situation and make sure that the home fits the needs of your family. Full renovation or remodels can place a significant burden on you and your family and you must be prepared for this.
If a foreclosed home seems right for you price wise, then do you homework and learn more about buying a foreclosed home. The market is flooded with foreclosed homes and the perfect one is out their waiting for you.