June 16, 2015 by Leave a comment

Buying a home in foreclosure may seem like a good way to get in on some cheap real-estate, but with all the possible headaches, is it worth it?

Ultimately, that’s for you to decide, but if you do choose to give it a go, keep these five thoughts in mind.

1. Find a real estate broker who specializes in foreclosed homes

Having an expert on hand is always a good thing. They’ll provide useful insight, and a lot of times, they’ll be aware of homes that haven’t even reached the market yet.

2. Get a pre-approval from a lender

Most buyers want to shop around, find their perfect home, and then work out the financing. However, with foreclosed homes, the deals move quickly, and if you aren’t pre-approved, that extra time could cost you your desired home.

3. Prices can change

Just because it’s a foreclosed home doesn’t mean the price is set in stone; there can still be multiple offers that drive the price up. Do your research, and find out the recent prices of comparable properties (comps) to make sure your offer is on point.

4. Plan for the long-run

If you’re only goal is to make a quick flip, you could end up with regrets if your plan falls through. To avoid such a tragedy, have a back-up plan that accounts for you holding onto the property for at least five years.

5. It’s going to need work

Foreclosed homes are sold as they stand, and this almost always means you’ll be doing some renovating. If you aren’t friends with a skilled tradesman, or don’t like DIY projects, foreclosed homes may not be for you.

Carter Wessman is originally from the charming town of Norfolk, Massachusetts. When he isn’t busy writing about mortgage related topics, you can find him playing table tennis, or jamming on his bass guitar.

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