You may have heard about homes being foreclosed, but never actually known exactly what goes into a foreclosure purchase or what that means. Or maybe you are interested in purchasing a foreclosed home but not sure if that is the right move. Well, we are here to clear up everything you need to know about a foreclosure purchase!

When a home is foreclosed, ultimately it means that the bank has taken possession of the home due to someone’s inability to pay their mortgage on time each month, if they were paying at all. Once the bank takes the home and the home is officially foreclosed, eventually the home will go up for sale and be available for foreclosure purchase on the market.

When it comes to foreclosed homes, there are many myths when it comes to foreclosures in general, whether it is risky to invest in a foreclosed home, or if it is a smart move to make the purchase and invest in one in the first place.

Buying A Foreclosure Purchase

Here are some of the most common myths that we have come across, and the true facts about a foreclosure purchase:

Myth 1: The process of foreclosing a home is quick.

When a person is late on their mortgage payments, or stops paying completely, the process of the home going into foreclosure actually takes longer than most people expect. It can take up to 6 months, sometimes longer, and is a very extended process for most families.

The plus side of the process taking longer is that it does give most families the opportunity to attempt to save their home and get back on track with paying their bills and becoming financially secure again. 

Myth 2: If you’re looking to buy a home, a foreclosure purchase is the best deal.

Although many people can get good deals on mortgages for a foreclosure purchase, it is important to not rule out homes that are sold by individual owners and families. Homes that are on the market that are not foreclosed are often an even better deal, especially since they can be more negotiable. Not only that, but they are generally more “move-in ready” than a lot of foreclosed homes will be. Of course, this totally depends on the individual situation, and if you work with a real estate agent, they can help guide you as to what makes the most sense for you and your financial situation.

Myth 3: You cannot hire inspectors for a foreclosed home.

Unless you are purchasing a foreclosed home at an auction, you are always allowed to get the home inspected before making your final purchase. Realistically, banks even prefer you get the home inspected, so they can avoid being held liable for any potential injuries or damages down the road.

Make sure that you do the research and hire the right inspectors to get this process done before officially making the purchase. This will help to avoid any potential surprises that you might run into after already purchasing it, which can sometimes be very costly! And it will be a deciding factor on whether you want to move forward with the purchase, if inspectors come across anything that you know will need work down the line. 

Overall, if you are looking to purchase a new home, make sure you do the proper research and look at all your options before making your final decision. A foreclosure purchase is sometimes a great opportunity, while other times it may end up costing you more in the long run. Of course, we are always here to help to ensure that you end up with your dream home

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