Questions to Ask Before Buying a Foreclosed Home
If you are a first time home buyer, then you may not be aware of essential questions to ask when buying a home - let alone homes in foreclosure. Regardless of whether you are an investor looking to purchase fixer upper homes or if you are looking for a new primary place of residence, you have to know what to ask before you purchase bank foreclosures, short sales, or any other type of distressed property. Below are some essential questions that you should ask the home seller before you sign on the dotted line.
Are there Liens Against the Property (taxes, assessments, etc)?
When buying a foreclosure, it is absolutely essential that you ask the seller if there are any liens on the property. If the property has any liens on it and ownership is transferred to you, then you are responsible for the liens. Not only should you ask the seller if the property that is for sale has liens, but you should also have the titled checked as well just to make sure you know that the property is free of liens.
What is the Age of the House, Roofing, Plumbing, HVAC and Wiring?
Although most people remember to ask how old the house is, many forget to ask about the age of the roofing, plumbing, HVAC, and wiring. Why, exactly, is it important to ask about the age of these things? Put simply, they typically cost a significant amount of money to repair. Therefore, before you buy foreclosures, you should enquire about the age of these key areas of the home that are often expensive to replace and/or repair. Furthermore, you should also ask about the foundation of the property (specifically settling and cracks) and make sure that the home is free of other issues, including water build. As a home buyer, questions are your best friend and the perfect way to help you better understand the property before you make an offer.
What Past Problems Have You Had with this House?
When investing in foreclosures, along with asking about the systems that are expensive to replace, it is also important for you to ask the homeowner (or home seller) if they know of any other problems with the home. Knowing about any issues ahead of time is essential when deciding upon a reasonable offer for the home you are considering purchasing.
When was the Last Inspection? Has the Home Ever Been Treated for Termites?
You should also determine the last time that the home has been inspected and make sure the home has been treated previously for termites. Inspections are great for finding out more about the property that you are looking to purchase. Therefore, if there has been an inspection done recently, then you could possibly request a copy of that information so that you do not have to order an inspection yourself. In regards to termite treatments, termites can cause a significant amount of damage to a home - damage that often goes unnoticed. Therefore, make sure the home has been frequently treated for termites to increase your chances of obtaining a solid property that is not infested with unwanted pests.
How did the Seller Decide the Asking Price?
Another great question to ask the seller is how he or she determined the asking price. Sometimes the price is determined based upon the amount of money still owned on the loan - especially if it is a bank foreclosure. However, other times the price is determined by comparing the home to other, similar homes on the market. Asking the seller how the price was decided can help you better understand if you are able to negotiate a better price.
Others Important Questions to Ask when Buying a House
Along with the above questions, you should also enquire about things that are outside the home. For example, it is recommended that you ask about the neighborhood and surrounding community. Is the neighborhood family friendly? What are the surrounding residents like? How far is the home from public transportation? What are some nearby attractions? Plus, ask any other questions that you are wondering about the home or the surrounding area - obtaining the answers to your questions can go a long way in helping you determine whether or not to buy the home you are considering.
In conclusion, when wondering how to buy a home foreclosure, it is essential for you to ask the right questions (this is especially true if you are taking out a second mortgage to purchase the home). These foreclosure questions can help you determine if the home you are considering truly is a good investment opportunity or if the home will be more work in the end than it is worth. When entering into the home buying process, arm yourself with great questions - allowing you to walk to the closing table with confidence.