Is a Foreclsure Right for You?

Does buying a foreclosed property save you money?

If you are looking to make an investment, however, you need to consider the market in which you are buying a foreclosure. A weak and ailing market could mean values will continue to fall. Buyers may be scarce. This is not an ideal environment for an investment.

Other issues must be taken into consideration, as well. The process of buying a foreclosure can take weeks longer than traditional deals. This is simply the nature of the beast. A foreclosure is a legal process. A foreclosure also means you must buy title insurance. A title search will pick up errors before you sign the check and protect you if something was overlooked. In the unlikely event that a former owner returns to challenge the foreclosure, the insurance company will defend you.

Foreclosed houses also warrant very close home inspections. There have been horror stories of new owners finding cement poured down drains by the disgruntled evicted. Be sure to see the house for yourself before you sign on the dotted line. And have a licensed professional carefully examine the home.

Even if the property hasn't been purposefully vandalized, many foreclosures need extensive repairs. A home may simply have been neglected and older homes require updates and normal upkeep. Budget carefully as you assess how much work the property will require.

If you take all of these matters into consideration, a foreclosed property may be the ideal buy for you.