Foreclosure Homes For Sale - Inside Info You Need To Know If You're A New Investor

January 21, 2022

There are foreclosure homes available for sale on every corner. Many people are trying to make it big in the market by jumping in and buying foreclosure homes. However, just because a property has been declared bankrupt does not necessarily mean that it is going to be a bargain. You can easily lose your shirt if not careful.

It pays to be familiar with the various types of foreclosures if you are a first-time investor looking to purchase Homes For Sale In Sedona Az one or more foreclosure homes. Here are some tips and tricks to help you choose the right one.

3 Types Of Foreclosed Homes Available for Sale

I. Preforeclosures - These properties are still owned by their owners, but are heading for foreclosure.

Dealing directly with owners can often lead to great deals for investors. Many owners are open to short sales. FYI: Short sales refer to the sale of a property for less than what is owed on the loan.

The lender must approve all short sales. Even though you might strike a deal directly with the owner, it will not be accepted by the lender. The lender is the legal owner until the mortgage is fully paid off.

II. Courthouse Step Sales: Also known as Sheriff's Auctions. These are exactly what you hear. This is where a bank or other lender sells a house at public auction to a highest bidder.

It is best to leave this area to professionals when investing in foreclosure homes. Why? You don't know what your investment is.

We don't have the time to inspect. Sheriff's Sales sells foreclosed properties "as-is".

The lender also sets the price -- it doesn't start at $1 and go up. A lender will usually list a property for sale starting at the amount owed. For example, if a homeowner owes $50,000, the starting price would be that amount.