Buying Foreclosures Can Be A Win-Win
Sales in the Real estate market have been booming for years, but now the majority of home sales have slowed down. We are in what is considered a 'slow market'. Homes are not appraising for what they once did, so the selling prices have dropped. You can no longer get the price you once wanted. There is a large inventory of homes for sale. The mortgage meltdown, where there are no longer hundreds of subprime lenders have an impact on the market.
The resets of adjustable mortgages have home owners scrambling to pay their mortgage each month, which is causing foreclosures to reach an all time high.
It can still be a good time to purchase property. Many first time buyers and real estate investors buy more real estate in slow markets because they are able to purchase properties at lower prices than previously possible. Now is a great time for sellers to offer Owner Financing, which would allow more buyers the opportunity to obtain home ownership. If the seller markets the 'deal' and not the house, more interested buyers will come your way.
If you are looking to purchase property in today's market, one might consider buying a foreclosure property. First-time home buyers are looking into foreclosures because this is an excellent opportunity to buy a house at a lower than market-value price.
If you approach a homeowner facing foreclosure, you can offer less than it's current market value, but still offer more than what they owe the bank. This can be a win-win situation for both parties. Take into consideration the state of mind the homeowner is in if facing foreclosure. This will not be a happy experience. Actually a very stressful time for them, but if they can sell their property before the actual foreclosure takes place, this may enable them to walk away with money in their pocket.
ex: A Home is currently appraised at $400,000. They owe to the bank approximately, 200,000.00 A buyer offers them $300,000.00. This home owner could actually walk away with $100,000.00. If their home went to foreclosure auction, they probably would not receive appraised value or receive extra money to keep in their pocket. They may only receive what they owe to the bank. If they tried to sell their home on the market, they may run out of time.
When a home owner is in the pre-foreclosure stage, potential buyers and/or investors will be able to do the most good for the homeowner and for themselves. Pre-foreclosure is where further damage to the home owner's credit rating can cease and the home may be sold before getting the lender involved. The best potential leads to locate a property at this stage is from a foreclosure database.
According to RealtyTrac, foreclosure filings — default notices, auction sale notices and bank repossessions were reported on 223,651 properties nationwide during the month of February 2008, a 4 percent decrease from the previous month, but still a nearly 60 percent increase from February 2007. The report also shows one in every 557 U.S. households received a foreclosure filing during the month.
RealtyTrac offers information on the buying and selling of foreclosed properties. They provide Coaching and learning services, which includes an education section, questions and answers, MLS listings, search by state and pre-foreclosure information.
A 7 day free trial offer can be found on their site enabling you to search over 650,00 properties. Once a member of this free trial, you can search the properties in the state you wish and receive all the property details.
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