Property Manager MA: Buying a Foreclosure
If you are looking for a bargain, then purchasing a foreclosure or a short sale is a good way of getting a house at a lower price. The only issue is that there are a lot of challenges in the way.
Difference between a foreclosure and short sale
A foreclosure is when a borrower fails to make mortgage payments over time. That is when the lender forecloses upon the property and claims ownership. It is not beneficial for them to hold the house for long so they sell it through an auction or with the help of a real estate agency.
The difference between foreclosed properties and short sales is that the former is owned by banks while the latter is owned by the borrower. Plus the short sale involves the seller to arrange a deal with the lender, where the price is less than the amount owed on the property. Basically the lender waves off the rest of the loan and sticks to a lower price as a small loss is better than a huge loss.
Unfortunately a short sale takes quite a long time to be processed. The lender has to agree to the sale as they have a lien on it and only then can an agreement between the buyer and seller be drafted.
How to find whether a foreclosure or short sale is for you
The best way to get started is to be familiar with the processes. Read up on foreclosures as much as you can. Try and attend as many seminars as you can so you can be up to date with how it works out.
It also helps to get help from the professionals who have done this before. They are the best ones to guide you on this. It also helps to befriend local real estate agents as they are often on good terms with lenders. The lenders inform them about properties which are not listed and you end up getting a head start on others.
However you need to remember that you have to do everything according to the law so doesn’t break any rules. It won’t help you to get any legal advice from the real estate agent as they will want to get a sale done. Make sure you consult a real estate lawyer before going ahead with any deal or consult a Property Manager MA
Make sure that you can afford the property before you go ahead with it. If you plan on renovating the property and selling it later then make sure that you can afford the mortgage if you can’t sell it right away. In the event that you want to live in the house, make sure you have enough in your budget to afford it. It also helps to make sure that you know what sort of legal issues you can be tied up with if you get the property.
We hope you liked our guide “Property Manager MA: Buying a Foreclosure “.