Foreclosed Homes Listings: What to look for

DKrunner | Jun 29, 2010 |

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A foreclosure home search requires a few tweaking of the normal house hunt. With any home purchase, it's always important to proceed with caution, but that it especially true when your search is zoned in on foreclosed home listings. Follow these steps to start off your foreclosed homes search.

Do the background research to ensure that your foreclosed home listings do not have liens against them. Any home foreclosure listings that you are truly putting serious consideration in should be checked for liens. Most realtors and lenders will require that you do this step when considering buying a foreclosed home, but you also need to be a defensive and smart shopper and be willing to take the initiative to do it on your own, as well. It takes a little time, effort, and paperwork, but in the long run, you can save your bank account, credit history, and overall stress level a lot of grief.

Another thing you want to look for when shopping listings of foreclosed home is what stage of foreclosure the properties are in. Foreclosure listings will be in a wide array of stage; some may be in the early stages (i.e. a possible "distress sale"), while other foreclosed homes may be owned by the bank entirely.

The easiest foreclosure to purchase is the bank owned foreclosure. Banks are not fond of being in the business of real estate, which puts the bidding odds in your favor.

Keep in mind that other foreclosure listings may still have a family living in them. This is something you need to be able to work around (both emotionally and contractually).

Because a foreclosure can be such a terrible experience for the people losing their home, sometimes emotions get involved. Some people who are experiencing foreclosure have been known to strip the house of everything that can possibly be removed (think cupboards, appliances, maybe even the decorative moldings).

For this reason, it's important to be clear about what you are purchasing with a foreclosure listing. It is typically the case that the state of the home when contracted is signed is that way that it stays, but this can get a little sticky with a foreclosure home.

Overall, it is important to do your research and thoroughly research the home's history of liens and loans. Be a smart consumer and protect yourself with a thorough purchasing contract. Do the necessary footwork to ensure that your foreclosed home purchase stays an excellent deal.