208,078 New Listings - November 2009 - Last update November 20, 2009 12:30 PM EST 
Benefits of Pre-Foreclosure Sales
If you are looking at the current economy and the drastic rise in home foreclosures across the country, it might seem appealing to try and buy a foreclosure home while the conditions may be ripe for a great deal. Many people are thinking just along those lines now and there is potential to get a home in this climate at great savings. You just have to be careful and make sure you know what you are getting, since most foreclosure homes are bought “as is.”
“As is” means any problems with the home structurally or financially will become your responsibility once you buy the property. Some problems can be large enough that they overcome any savings you received by a lower price. The best way to combat your risk and get a good deal is to search for a pre-foreclosure sale.
Pre-foreclosure means the home is not yet been taken to court and processed into foreclosure. The process is coming but has not been done yet, so it is in the best interest of the homeowner to sell quickly so they can limit the damage to their credit report. These sales are less risky than trying to win a home at a foreclosure auction for a couple reasons.
The most important thing about a pre-foreclosure sale is the ability to inspect the property before you buy. This is not always the case with an auction property. If there are any structural issues that will be more expensive to fix than it is worth, you will know that before you make the mistake of buying.
You will be rushed for time during a pre-foreclosure sale because the owner will need to sell the property before it does go into foreclosure. Yet, you will still have a time to run a complete title check to find out if there are any liens on the property that would become you responsibility. It is also your responsibility to pay any outstanding taxes on your new property, so you will have time to check for that as well.
Working directly with an owner who has a great benefit in selling quickly is also a perk of this type of foreclosure sale. At an auction you are against the homeowner and could even end up having to evict them if they are still in the home when you purchase. But with a pre-foreclosure sale you have the ability to work with the owner in a more peaceful manner. Of course they will likely be upset and you’ll have to do it with care, but it can be less of a hassle than winning at auction.
For a beginner just getting into the foreclosure buying game you are better off looking for a pre-foreclosure sale than an auction if you really want to make some savings. Most auctions end with the lender winning because they do not want to lose any money on the deal. When working directly with the homeowner your great deal is also in their benefit in some ways at least.
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I read a book called “Mortgage Meltdown” and it really helped me understand that I’m not the only one going through this. I was also able to apply for a grant from a non-profit to help me with my mortgage. I think anyone who is trying to save his or her home, like me, should read this. Go to http://www.48grant.com
I read a book called “Mortgage Meltdown” and it really helped me understand that I’m not the only one going through this. I was also able to apply for a grant from a non-profit to help me with my mortgage. I think anyone who is trying to save his or her home, like me, should read this. Go to http://www.48grant.com