Are You Really Ready to Purchase Foreclosed Homes?

by Simon Lindsay on Foreclosures

When you purchase foreclosed homes you get a chance at instant equity and savings. A good understanding of the foreclosures market is required if you want to be successful in your endeavor. It does not matter if you are a first time buyer or an investor looking for a lucrative business venture, you can never have too much information on distressed homes.

Definition of Foreclosure

A foreclosure is the legal proceeding where lenders can go after their defaulting borrowers by seizing their property. The period of non-payment before the lender begins the process is usually three months. A foreclosure is an ongoing process that ends with the lender repossessing the home of the borrower. When you purchase foreclosed homes you are essentially buying a property that is the result of a legal action.

A foreclosure is an ongoing process ending with the lender’s repossession of the borrower’s property for which the loan was taken out in the first place. The process has several stages including the pre-foreclosure, the auction and redemption stage, and the actual foreclosure and seizure of the property. Foreclosure laws differ according to the states implementing them and so it may be prudent to get acquainted with these laws for the state you are planning to purchase your home from.

Finding Foreclosures

When you purchase foreclosed homes, you need to have the capacity to pay for the property. Sellers expect buyers to be able to present a loan pre-approval certification along with their offer. This document states how much you can borrow and ensures sellers that you are indeed able to pay for a home.

Look for homes in good neighborhoods. Make sure you have access to community services such as education, health care, employment and recreation. When you look for homes in online foreclosure listings you will have access to a large database of distressed properties across the country which can be searched by location and price as well as other conditions you may have.