Buying foreclosed homes? Choose carefully.

This article surfaced in 2008 from the ABS-CBN website:

Whether it’s investors looking to buy cheap and sell for profit, or families who want to bring their renting days to an end, foreclosed homes have a sure market.

In the last couple of years, foreclosed properties being sold by banks have been gaining popularity on the idea that they fit more easily into the budget than brand new homes.

Banks regularly hold auctions to bid out these second- or, sometimes, third-hand homes to prospective buyers. But they also book effortless sales just from taking dozens of calls a day from clients.

The secret is to give people incentives to entice them to take a risk on a foreclosed house, Janette Abad Santos, assistant vice president of Philippine National Bank’s (PNB) Asset Management Group, told abs-cbnNEWS.com in an interview.

Foreclosed homes could sell for a fraction of their worth in the market, and may seem like a steal. However, if one’s not careful in choosing, these kinds of homes could also harbor unpleasant surprises and could run into a lot of money for those who don’t have much of it to start with.

Read the rest of the Article Buying foreclosed homes? Choose carefully.

9 Tips for Buying a Foreclosed Home

You feel you know everything about buying foreclosed properties but there’s always something new to learn (or remind you!). CNN has come up with 9 tips to buying foreclosed home.

If you’re into flipping foreclosed properties, here’s a wise tip:

Don’t expect to profit from a quick sale. Investors who buy intending to do as little as possible to a house, hoping to resell for a profit when the market turns around, may find little profit and a lot of headache. Some cities are cracking down on neglectful property owners, charging penalties that increase over time, and unmaintained homes lose value quickly.

What’s your reason for buying foreclosed home? Do share!

Read Article Here – 9 Tips for Buying a Foreclosed Home

How Foreclosures Work

From about.com, this is one of the most educational video there is on the internet about foreclosed properties. Spend a few minutes watching the video and learn from what she says.

How Do Foreclosures Work

A wise take away from the video:

“You need to know that a bank-owned foreclosure home may be vandalized or stripped by the angry home owners so it will be ‘as is’. If something breaks or malfunctions, the current owners will not fix it. They previous owners sell appliances or try to destroy a home by flooding it.”

Thinking of Springing for a Foreclosed Home? Check for these 5 Problems First

Popularmechanics.com has an article on what problems to anticipate or check out when buying a foreclosed home.

Foreclosed homes can sell for a fraction of their original worth, and may seem like a steal: A fixer-upper at a low price. But Brion Grant, president of the American Society of Home Inspectors, tells PM that while there are plenty of good deals to be found on the foreclosure market, these homes can also harbor unpleasant surprises—including wild boars. Here are the most common problems that might mean a foreclosed home is a money pit in the long run.

What could be applicable here in the Philippines, would be neglected maintenance.

“Most maintenance stops when the payments are no longer being made,” Novak-Smith told PM. Grant said people who know they’re losing their house don’t typically care whether they keep a fresh coat of paint on the walls or if tiny roof leaks are sealed. Mechanical systems frequently suffer in a foreclosed home because they need a fair amount of care, he said–foreclosures frequently have heating systems at the end of their lives, often prematurely so because the homeowner neglected routine maintenance, like cleaning the filters or bleeding the radiators. The ventilation systems are often forgotten, too, he said, which can lead to mold problems. Home buyers looking at foreclosures need to bear these facts in mind, Grant said–they could be inheriting a much larger and costlier repair job than they first expect.

You’d be lucky if the property has a caretaker. But despite the presence of a caretaker, some banks don’t bother to have any of the “house problems” repaired – for instance, bad plumbing, or dilapidated ceilings. They’d rather the new owner fix it – which only means you can bargain or negotiate even more if that’s the case.

 

Read more: Thinking of Springing for a Foreclosed Home? Check for these 5 Problems First – Popular Mechanics

 

How to Buy a Foreclosed Home

Here’s an article from EHOW.com on how to buy a foreclosed home.

When you buy a foreclosed home, you’re cashing in on a home someone was no longer able to pay for. Foreclosures are difficult–both to locate and to execute the transactions–but the potential to turn them over for a tidy profit may be there.

One of the more salient points in the article is this step, which is very obvious and “common sense” but some folks hardly pay attention to:

Have your agent check nearby or comparable homes to see if the asking price for a foreclosed home is, in fact, a bargain

Some foreclosed houses can no longer be inhabited because of age or would cost too much to repair. Removing it and building a brand new one would be more economical. Sometimes you’ll wonder why it’s a bargain – maybe because the house no longer has value, and you’ll only be paying for the value of the lot.

It always pays to know more – read: How to Buy a Foreclosed Home | eHow.com