Buying bank foreclosures homes and buying homes at public auctions are both viable options for investors and owner occupant buyers, but the safer way for the vast majority is buying bank foreclosures homes. Also, some lenders prefer to sell their bank-owned properties at a liquidation auction, often held in auction houses or at convention centers. The recent statistics on Home Sales is up, President Obama has made legal grounds for banks to cooperate with Homeowners, and Large Tax incentive through 2009 are taking affect.
But once you get the hang of it, foreclosure auctions can be a great avenue to find profitable real estate investment properties. If you’re thinking about buying a foreclosed property and have enough cash for the purchase, it’s helpful to evaluate the benefits of your choices.
Although buying a pre foreclosure can be challenging, investors often find that pursuing pre foreclosure homes is well worth the effort, as they can usually be acquired below market value. When you’re looking at listings, keep your eyes open for properties listed as REO Foreclosure.
The FHA is especially known for selling HUD homes for less than the average sales price in a given area. Furthermore, the homes sit empty for months or years at a time awaiting foreclosure sale; often creating an unattractive public nuisance. The reality is that buying a home costs a lot of money, and most of us don’t have unlimited bank accounts to fund the purchase.
Foreclosure by power of sale, also called nonjudicial foreclosure, and is authorized by many states if a power of sale clause is included in the mortgage or if a deed of trust with such a clause was used, instead of an actual mortgage. Probably the last one that people usually think of, though maybe the most lucrative, is the pre-repossession purchase – sometimes referred to as a short-sale.