Helene Kelbaugh eXp Realty Baltimore Realtor®: Tips for Buying a Foreclosed Home

Tips For Buying A Foreclosed Home

Helene Kelbaugh, REALTOR of Keller Williams Realty Baltimore

Baltimore Real Estate Agent

www.HeleneSellsHomes.com

443-465-8443m 410-342-4444o

Homebuyers in the market for a foreclosure that is their dream home need two things: lots of patience and the stomach to do battle with investors. Any home that is in a decent area and priced right is sure to have fierce competition in today's market.

Homebuyers in the market for a foreclosure need those two qualities big time! Buying a foreclosure is a lengthy process, and, although most investors prefer pre-foreclosure sales and auctions, buyers will face their share of competition for these bank-owned homes.

Let's take a look at foreclosure-buying how to participate.

Buying an REO

Purchasing a bank-owned property is much easier than buying a home at auction and much like a conventional purchase.

LOAN APPROVAL

You'll need a loan preapproval letter from your lender, unless you're paying cash, and the services of a real estate agent.

DISCLOSURES

Most REO properties are vacant and somewhat cleaned up. Although the bank won't supply you with property disclosures as sellers in a conventional transaction are required to, you will be allowed time for inspections. In the State of Maryland banks are one of the exempt parties from providing disclosures.

INSPECTIONS AND DILIGENCE

Many experienced REO buyers perform extreme due diligence, such as checking the city planning office for permits that may be on file for any work the previous owner performed. Have anything that looks the slightest bit suspicious inspected, from the roof to the foundation. It is ideal to have all inspections done on these types of properties. There is typically no history given with regard to property condition.

REPAIRS

Banks typically don't pay for repairs to the property, so you'll need to take on that expense. If there are lender required repairs, that will typically be a buyer expense otherwise, the purchase will not close. Ultimately, although it may seem that you're getting a bargain-priced home, once all is said and done, it may be worth it to purchase another home in turnkey condition.

Ready to start the home buying process?