Can You Really Save Money by Purchasing a Foreclosed Home?
69With so many foreclosed homes going up for sale and even more yet to come, potential home buyers who are now beginning to consider investing in a home are wondering if purchasing one of these foreclosed properties can really save them some money.
The short answer is yes. And how much you save will depend a great deal on the area the home is located and even what type of home you buy. It also depends on what stage of the foreclosure process the home is in when you purchase. Here are a few facts that could help you decide if buying a foreclosed home is right for you.
The first thing you need to consider is whether you should buy at auction or wait until a home has gone by on the market and is listed for sale. Buying a foreclosed home at auction can often get you huge savings as the home generally goes to the highest bidder regardless of it's actual value. Most people who purchase homes at foreclosure auctions do so with the intention of getting the home at only 50% to 60% of it's value. However, keep in mind if you buy at auction you may be purchasing a home still occupied by the previous owner and it will be up to you to deal with getting them out of the house.
- Investing In Rental Property
With most of the public being afraid to invest in buying a home until the economy picks up, employment opportunities increase and the values of homes increase now may be a good time for those of you who are looking to invest in rental property to do - Highlands Ranch Real Estate
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Search Denver Real Estate for Denver Homes and Condos for sale - Denver Real Estate MLS Listings.
If you buy what is called an REO (real estate owned) home, the bank has either decided to skip the auction process or the home wasn't purchased at auction and has now been placed on the market. The national average for savings on an REO home is around 27% of the homes value. So, depending on the value of the home it is possible to save tens of thousands of dollars on the home's purchase. However, you really need to have a real estate agent that really understands the ins and outs of foreclosed properties as well as the value of homes in the area you are buying in order to ensure that you really are purchasing a home for less than the market value.
You may also be able to buy either a HUD or VA foreclosure for less than one that the bank is selling and even the Federal Government has homes for sale. Keep in mind however, that almost all foreclosed homes are sold as is which means that if they need major repairs you could end up spending more than you actually saved on purchasing the property.
