You may not like to think about profiting from someone else’s loss, but you can find many homes that have been foreclosed on at bargain basement prices. Looking to buy from proven sellers also more or less ensures that you have a number of options to look into, and the right real estate professionals will also help you find the foreclosed property that best fits your budget, and has the least or no problems for you to contend with.
If they have been paying rent on time (admittedly, it might be hard to get the facts unless you can talk to the prior owner), and have been taking reasonable care of the property, you might decide to keep them and negotiate your own, new rental agreement or lease (after giving the tenants 90 days’ notice).
According to the latest report from RealtyTrac, a company that monitors the trends of foreclosures across each state, “Florida posted the nation’s second highest state foreclosure rate in November 2009 with one in every 165 housing units receiving a foreclosure filing during the month.
As with any home purchase, it’s important to predetermine your debt-to-income (DTI) ratio As the name suggests, this ratio analyzes how much of your gross monthly income your monthly expenses (including your estimated new mortgage payment) will consume.
I have home buyer clients who specifically want to evaluate only foreclosures or HUD homes, those offered by the government, usually by a bidding process, because they want a house that they can buy cheaply and work on it while living in it. As it turns out, most end up buying a conventional home once I show them a couple foreclosures and they begin to understand what they are up against.