“That home is in foreclosure.” You get an immediate mental picture of an overgrown yard, and falling down house or angry owners who are resentful of the foreclosure and trash the property. Sure, this is true of some foreclosures but not all.
The biggest caveat when buying a foreclosure home is that it is typically sold as is, which means the bank is not going to fix any problems. And unlike a normal home sale, in which disclosure requirements force owners to reveal a home’s every flaw, there’s no such legal stipulation in a foreclosure.
Since banks are often eager to unload these properties, they aim to break even with an asking price that’s typically the sum of the remaining mortgage note plus interest, lawyer fees, and penalties. On average, this ends up totaling about 15% below the home’s actual value—and homes often sell for less than asking price. […]
Not all foreclosures mean a bad investment, or a difficult transaction. And some can present great opportunities for buyers.With luxury foreclosures sometimes the bank WILL do repairs.They will spend the money needed to make sure the house is maintained and “in keeping” with the value of the neighborhood. For [this] listing in Ellicott City, improvements included fresh paint, new carpet and a new furnace. What was an unfortunate situation for the previous owner, who took meticulous care of the home, presents a great opportunity for the next buyer. Click to read entire article.
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