Foreclosures – Curse for Some But Opportunity for Others

November 13th, 2008 | Tags: Foreclosed Houses

Foreclosures are undoubtedly a curse for some but it also provides opportunities for others. The banks are offering unprecedented discounts and this allows many to chip in and walk off with a bargain deal, said Renee Spahn of Coldwell Banker Pro West Real Estate, Medford. Spahn suggested that those interested in buying foreclosed units should take the help of those agents who are experienced in the line.

After the foreclosure process is over the buyer has to deal with the lender – usually the bank. Although there are stories going around of fantastic bargains in foreclosure auctions it is not always the same every time everywhere. She said, “At a lot of auctions, people get into a buying frenzy”. She suggested contacting a realtor to approach the related bank. The agent knows all the ins and outs about the real condition of the title and whether it is clear and free. Foreclosure postings are made in newspapers but the realtor can narrow down talks to suit the buyer.

Those who already own houses can also buy a foreclosed house. The question is the problem of managing two mortgages simultaneously. In the present mood of the market the second house can be bought cheap but the first one will now sit indefinitely waiting for a buyer. The real estate agent can include a clause in the deal by which the purchase of the foreclosed house will be contingent upon the sale of the first house. Another alternative will be to put the first house in the market first and then hunt around for another in the foreclosed market after an offer has come from an interested buyer. Spahn added, “It doesn’t hurt to put out a feeler. A lot of people think it’s so dismal out there, but there are always people relocating and coming up from California.”

Another broker, Colin Mullane of Re/Max Realty Group however warned that purchases of foreclosed units are tricky with many pitfalls. A novice buyer who is impatient is not the right person for this job – one has to be patient having finance lined up. The buyer must take note that the bank has already repossessed the foreclosed house but in the case of a short sale the house is with the borrower. Then alsothere may be multiple mortgages on a single property. The purchaser will have to deal with each one separately to get a clear title after making payment.

To avoid hassles the regular market is the best option.