With the increased number of foreclosures around the country, more and more buyers and investors are seeking out foreclosed properties or properties that are advertised as Short Sales - meaning that the bank may accept less than what the sellers owe on the property.
Foreclosures can be an opportunity to get properties at a discount. We have personally purchased two foreclosed properties ourselves and feel like we made a good investment.
However, it is important to be aware that can be risks that come with foreclosed properties such as:
- AS-IS: Most foreclosures are sold "As Is" and without a seller's property disclosure that would list any known defects in the property. There are usually specific forms that you will be required to sign to protect the bank that has taken possession of the property. Make sure you have a thorough home inspection so you know what you are buying.
- REDEMPTION PERIOD: Many states have a "Redemption Period" where a person who lost a home to a foreclosure can payoff the property and redeem it. Make sure you understand your rights and all potential risks if you buy a foreclosure.
- PRICE - just because a property is a foreclosure does not necessarily mean that it is priced at a discount below other homes on a market. Make sure you understand the current market value of the home. Your Realtor (R) can help you understand the local market.
- FORECLOSURE ALERTS - There are several services that will charge you a fee to notify you of foreclosed properties. If you are in an area with very few foreclosures, this may not be worth the investment.
If you are looking for foreclosures or short sale properties, in or around the Missoula, Montana area, contact Kevin & Monica Ray of Access Realty at 406-207-1185. If you have legal questions regarding foreclosures or laws in your state, please contact an attorney.
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Kevin & Monica Ray are Missoula Montana Real Estate sales and marketing professionals for Access Realty in beautiful Western Montana. For more information on Western Montana, they can be reached at 406-207-1185 or online at www.YourMT.com.
Kevin & Monica, I didn't know some of this..for example, I thought you would get a home inspection even for a foreclosure. Thanks for the post.
Hi Carole - thanks for visiting our blog. I would still recommend a home inspection on a foreclosure but the bank will usually have you sign forms stating that the home is "as is" to protect them from getting sued if there are problems with the home after sale.