Foreclosures are by far the most requested properties that our buyers want to see in this current market. These bank owned properties can be real steals as long as you educate yourself and realize that a low price is good but should not be your only concern. I’m sure you have all heard that “you get what you pay for”. If there are several bank owned homes in an area that you are looking in, go through all of them. Many of these will need major repairs and many won’t. You may actually get a better deal on a home that is priced a little higher but has all the major appliances and is in “move in” condition. Not everyone wants to spend the time and money to fix up a home. Take your time and look at all your options before you decide on the best value for your money. As I have said many times in the past, your timing could not be any better. If you are planning to take advantage of the first time home buyer incentive (8,000.00), your home should be in escrow before the end of October. You may need up to 60 days to close your escrow and this program ends December 30. Here are the things to consider when buying a foreclosure.

1. Do the comparable sales in the area justify the price you are willing to pay? If the home is priced much lower than the comparables and there are several other offers, this home probably will sell for more than asking price.
2. Are you willing to buy the property “ As is” ? You will have to sign a disclosure that you give up all your rights and accept the home in its current condition. You will have a due-diligence period and we highly recommend that you have a home inspector check the condition of the property.
3. Are you willing to keep the property 3 to 5 years? Most experts agree that the market will take at least this long to recover.
4. If the property is damaged or in need of repair, can you do the work yourself? If you can, you will save money and have control of the project. If you need to hire a contractor, your costs will go up dramatically.
5. Will the property appraise for the type of loan you can afford? If you want an FHA loan, the flooring will need to be completed as well as all appliances installed. Conventional loans will be an option but will require 20% down compared to 3.5% for FHA.