What Is Foreclosure Process And What Are The Benefits Of Buying Foreclosure Homes
Foreclosure process is a procedure which starts when a home owner is unable to pay
the loan amount unpaid to the lender or is unable to pay taxes outstanding to the government departments. In both cases the Lender or Government issues a Lis pendens which is a notice for the start of the pre-foreclosure process.Home Owner is given a certain time after the lis pendens is issued to either sell the home themselves through short sales or settle the due amount. After the notice period the foreclosure process starts and the property is put up for auction by the Banks or Government Departments.
Benefits of Buying Foreclosure Homes
There are several benefits of buying foreclosure homes like
1.Cash benefit - The property is available at 30 to 50% discount as the Lender wants to recover their loan amount and they do not have any profit making motive.
2.No Legal Hassles - There are no legal hassles when buying a foreclosure home through banks or government departments as all the legal formality has already been taken care of these institutions in a professional way.
3.Furnished House - Sometimes you may get a fully furnished house and you save a lot of time otherwise involved in furnishing of the house. Only minor repairs may be required which is very minute.
4.Good Locality You can find a foreclosure home in good locality which would have been difficult otherwise to purchase a home in already developed area due to high rates or unavailability of land.
5.Easy Loans When you are buying a foreclosure home through bank foreclosures they offer you easy loan facility from their bank. The process of getting loan is easy as the bank will also have dual benefit of selling a foreclosure home, which is their liability and also getting a client for taking loan for a safe transaction.
6.Lower interest rates You may get the loans at lower interest rates from several banks to buy foreclosure homes.
How to Buy Foreclosure Homes
1.Make a list of all suitable foreclosure homes in your area.
2.Visit at least 5 short-listed properties from your list
3.Check the title of property, whether it is a clear title property
4.Check that all taxes and dues are clear.
5.Check the asking price of the property by similar properties in the neighborhood areas.
6.Negotiate with the seller for lower down payment and final price.
Foreclosure process is beneficial for first time buyers as you can live in a good locality by purchasing a home at much less price than the normal rates prevalent there. It is also beneficial for investors as you get a property at a highly discounted price which you may sell later at a good margin.
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