Investing in distressed or foreclosed properties

Investing in distress or foreclosed properties can be beneficial as they are much below the market value of the

property. They are usually homes in danger of going into foreclosure or sale because the homeowner defaulted on

his mortgage payments. Once a property becomes distressed the tax collector, debt collector, government or banks

begin the necessary proceedings to sell the home to collect mortgage payment.

If you are in search of an affordable home, you should look into distressed properties. In fact, distressed properties

can be sold at prices that are from 30%-60% percent off their original market value.

You must search Internet for such websites but one must keep in mind that some of the information is outdated,

some incorrect and some of the available properties might not be listed. With distressed or foreclosed properties time

is of the essence. Purchasers must close on the date specified by agency and cannot close after as there is penalty

of  $25-200 per day.

It takes 3-4 weeks to get a loan. So if you are approved for a loan, lender should qualify you as soon as possible. And

if you are planning to pay by cash, make certain funds available.

While purchasing any such property always obtain 3-4 bids from different contractors to estimate costs repairs, If you

do not plan to do it yourself.

The title you receive after purchasing such property is a special warranty deed, which may alarm other buyers, but

there is no worry as purchase of title insurance protects the buyer.

Foreclosure properties require special addendums and special contracts by individual bank. Foreclosure property is

potentially the most profitable, but require the most attention towards the details.