Buying a Pre-Foreclosure Property
Once the bank owns the property, it will handle eviction, if necessary, pay off tax liens and may do some repairs.
REOs are a significant part of the housing market and can be great deals for buyers, but there are some things you need to know before investing in one.
The pre-foreclosure stage can yield some real bargains, but most experts agree it is the most difficult stage during which to purchase a distressed home.
Be aware that a pre-foreclosure property is not necessarily for sale. The pre-foreclosure stage is the period between the time in which a Notice of Default (in non-judicial foreclosure ) or lis pendens (in judicial foreclosure ) has been issued to the homeowner and after the property is sold at a foreclosure auction.
The owner may be working to cure the default, or he may be hoping for a pre-qualified cash buyer to help him avoid the impending foreclosure.
Here are 10 tips to guide you through the search for and purchase of a pre-foreclosure home:
1. Begin the hunt One of the trickiest aspects to buying during this stage of foreclosure is finding properties. That’s because some of these houses are not yet on the market. Start your search by looking on Zillow for pre-foreclosures. This information is free after you register with a free account. Or, check your local newspaper for foreclosure notices. You may also want to market yourself with online postings, signs, fliers or postcards ( Willing to pay CASH for your home. )
2. Drive by Once you find a property, go see it so you can get a better idea of its location and condition. This could facilitate a casual meeting with the owner or a chatty next-door neighbor. Remember, the owner is probably still living in the home, so be judicious.