How To Buy Foreclosures And The Pitfalls To Avoid
Lately I have had people coming into Arbor Pass asking me about foreclosed or short sale homes. You can’t just buy Philippine properties for sale in the market without being critical of the investment. In a sweeping lawsuit, Cincinnati took aim at one of the nation’s largest sellers of foreclosed homes, Harbour Portfolio Advisors, saying that the firm owes more than $360,000 in unpaid fines, fees and violation notices. A short sale is a home that a homeowner tries to sell for less money than he or she owes on the mortgage. Only 65.5 percent of all Bay Area homes repossessed by banks in the 18 months ended January 2009 had been resold by mid-March.
I believe, when the large supply of foreclosures are released for sale to the public it should provide an excellent opportunity for the average small investor. Now, the reason you can obtain a foreclosed home so cheap is because the banks hate dealing with foreclosures because of the substantial loss they stand to take. Banks tend to put minimal effort into repairing homes which may be in pretty bad shape.
Dan Immergluck, a professor of city and regional planning at the Georgia Institute of Technology’s College of Design, estimated in an unpublished research paper that a firm like Harbour could generate an annual return of at least 28 percent based on the way it prices homes. Working for Arbor Custom Homes has allowed me to do just that…Every day I get to find people their dream homes where they can create new memories! Often foreclosed houses are very nicely kept and are in excellent condition, other times they are not and need repairs.
Cincinnati is seeking to prevent Harbour from selling additional homes to investors until the firm remedies all the outstanding building code violations at the properties it is selling. Because of this, many companies that can handle the internal cleaning of a foreclosed home, for example, won’t even bother to bid on the window cleaning. Buying foreclosed properties at the courthouse can be very dangerous for those who do not do their research properly. The two common ways of buying a foreclosed home are through a real estate agent or through a public auction.
Harbour sold its homes through an arrangement similar to an installment payment plan, with a high-interest, long-term loan called a contract for deed, or land contract. Buying a foreclosed property can be a complicated, but ultimately rewarding process in terms of getting more home for your purchasing power, stabilizing neighborhoods, and revitalizing communities. Keep in mind that a short sale for someone who cannot make their mortgage payments may be a far better choice than having the lender foreclose on the home. When buying Texas foreclosed homes, requirements that are in place should help keep the process as straightforward as possible.