Buying Homes in Foreclosure

By: Julie Thompson

One of the very popular methods of buying homes in foreclosure is through contacting the buyer. This is a very beneficial method of purchasing a foreclosure for the homeowner, the bank, and possibly for you.

When a homeowner realizes that they cannot meet the requirements of their mortgage agreement they often try many attempts to save their home. Many homeowners don’t realize a bank will work with them so they try to sell their home or come up with a loan to cover the costs of what they owe. Many people are losing their homes due to losing their jobs and other reasons. When this happens they realize they can no longer afford their home.

A homeowner doesn’t want a foreclosure on their credit because it will haunt them for many years and affect any lines of credit they may try and obtain. They will also be unable to purchase another home until the foreclosure goes away. Buying homes in foreclosure before they actually foreclose at the auction will save a homeowner from having a foreclosure on their credit and the both of you will benefit.

The first thing a bank wants a homeowner to do if they realize there is no way they can save their home is to try and sell the home. Banks want homes in foreclosure to sell before they have to take possession of them because a taking possession of the home really is the last thing the bank wants to do. Having a home on the books looks really bad for a bank and they would rather the home sold in the beginning stages. Buying a home in pre foreclosure helps a bank too. Plus, a bank will be willing to sell the home in a short sale.

When you purchase homes in foreclosure prior to the actual foreclosing you can benefit also. Some investors are able to transfer the loan into their name and immediately begin taking over payments. This means you can move in right away. Purchasing a home prior to foreclosure may also give you instant equity, especially if you purchase the house in a short sale. This is a prime time to make a purchase.

When you purchase homes in foreclosure and contact the homeowner always verify that there are no liens on the property. All parties benefit when a house sells prior to the date of the auction because the homeowner won’t have a foreclosure on their credit, the bank won’t have a home on the books, and you may obtain instant equity.

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Julie Thompson, has been working on studying the foreclosures market, helping buyers on the finer points of homes in foreclosure. Try to visit and begin your foreclosure homes by state search.

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