pros and cons of buying foreclosure property.?

Answer 1

A foreclosed property means somebody didn't make the payments, period.

I've sold foreclosures that ought to be bulldozed, and I've sold one that was new, all the upgrades ordered, never been lived in, with full builder's warranties in place. The one I bought to live in, we vacuumed, did a REGULAR cleaning of the kitchen and baths and moved in. Have lived there 2 1/2 years and nothing has broken yet. So condition wise, a foreclosure can be in ALL ranges. Buying "AS IS" means that nothing will be done to it. It doesn't mean stuff is broken.

One big advantage (which is going away) is that so many people look down on foreclosed properties, so the competition is a bit less.

Also, inspection contingencies allow for less leeway than a typical, seller occupied property.

Just have your Realtor include foreclosures as if it's just another listing. If it fits your needs and the price is right, buy it. If a "regular" listing is a better deal for you, buy that instead.

BTW - This weekend is probably the best weekend of the year to get a good deal on a house. Fewer buyers bidding on foreclosures. HUD houses still have bids due Sunday night... Call me if you're interested in Texas (especially San Antonio) HUDs.

Answer 2

Pros - Great return on your money if all the stars and moon are aligned right.

Cons - Like someone else stated, Murphy's Law. If you can imagine it, it will happen.

If you will be doing this on a regular basis, you need to know the house better than the next guy so you can stop bidding on it before you're in too deep.

The best time to buy the foreclosure is when it's pending, not at the court house step unless you were able to get a peek inside the house (legal or illegally). Once the house hits the market the bank will be asking for an arm and leg.

Answer 3

Many of us do this for a living. This is the start of my fourth year. Over 50 houses later and I feel that I have seen about everything there is to see.

Pro: You can make money just like any other small business. This line of work is truly a Risk:Reward ratio.

Cons: Endless. If you can imagine it, it will happen.

Trying not to spam, but the reference line is my business website. Do some of these homes look appealing? Well they do now! Most of them were complete wrecks on the inside. I almost NEVER get to see the inside of the property before I purchase, but that is because I am buying them directly on the court-house steps. You can minimize most of the risk by buying from banks or wholesalers after the auction. Sure, you will pay a bit more, but a) you will still get a property below market value, b) you won't be risking your financing, and c) you will eliminate the great unknown (what is on the inside?). Once you get some more experience under you belt, then you might consider my line of work. Best of luck.

Answer 4

The pros are that you may realize a savings over owner listings, they are usually unoccupied so there is no waiting period to move in, some may be loan assumable...

Cons are that they are not easily accessible/harder to sift through listings for - usually require a Realtor to assemble a comparable selection for you (reason many of the true deals are already gone), usually require work just to move in and more difficult to finance due to their history of foreclosure and any repairs needed that don't meet certain lenders acceptable standards.

I much prefer searching for forced sales. Searching area newspaper and FSBO sites for 'motivated' sellers who even advertise that they are facing foreclosure, divorce and just want someone to take over their loan amount. And my favorite are the ones going for taxes at the court house steps. Cash deals though. Cheapest with greatest profit potential - but be prepared for work.

Answer 5

You are purchasing a time stamp of someones worst emotional period. Years ago someone bought their dream home and that dream was shattered. Most homes are reflective of such and will have damages and missing appliances etc. Thats why they are seemingly a great deal. Many are and most are not, be careful and know your market, codes, and repair costs. Most time tested investors know this, most wanna bee investors will learn this the hard way. There are a variety of talents necessary to be a successful investor. The pro's and con's are directly porportional to the talents each has. Your con might be my pro, etc, the key I teach my students is to go there and look carefully before buying so you can know when to stop bidding.

Answer 6

Pro- you can probably save some money, most banks are not that desperate to sell a foreclosed house for a great deal below its fair market value

Con- The house will be sold "as is" and most foreclosed property will need a great deal of repair.

Answer 7

Pros: Cheap property, sometimes other usable items included

Cons: Sold as is, may not be in good shape. Maybe Guilt that you live in a house a family has been tossed out of.

Answer 8

It took about 8 dumpsters to remove the junk. The dog used the carpet. There were 5 bids on it. Had to rip everything out of the house and replace it. Nothing is maintained. They do look like crime scenes at times.

Answer 9

Cheap property ....you can live there and also you can just have an investment property and then sell it later for profit ....problems sometimes are there that they might not ber properly maintained but that is a small price that you have to pay for a good profit ....If you want to have a mortgage loan you can write to me at [e-mail] or call me at 480.751.4125 .I provide mortgage loans at very decent rates and my customers have a high end of customer satisfaction ...now the rates are like higher fives and lower sixes and you can also opt for 30 year loan periods.........

regards,
kish

Answer 10

The radio and television adult adult males certainly have an schedule. those are an analogous adult adult males who a twelve months in the past have been urging you to purchase properties when you consider which you may desire to "turn 'em" in six months for a huge earnings. Greed will section you out of your cash quicker than the rest.