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An active housing market has reduced the number of foreclosed homes in inventory, but there will always be foreclosed homes available to purchase. Many buyers are not aware of what to expect when purchasing a foreclosure. Here are some home truths about buying a distressed home.
Many buyers believe foreclosed homes sell at rock-bottom prices. They expect massive and unrealistic discounts. While the bank may be willing to sell for well below the fair market value, their goal is to recover the loss they incurred when providing the original mortgage. Additionally, foreclosed properties may have long-standing maintenance issues that require a substantial investment to remedy.
A foreclosure removes the primary mortgage debt, but a distressed property may have other claims for money owed in back taxes, for mechanical work and contractors’ fees. A complete title search should tell you if there are liens that need satisfaction when you purchase a property. Your real estate agent can guide you in how to discover unsatisfied liens or judgments against the property
Most owners do not simply move out of the property when they can no longer afford to make payments. When an original owner loses income, maintenance often becomes a low priority. And, if they have a medical disaster, a decline in health often means a decline in care for the property. Storm damage, pests, and other hidden issues mean damage to a home that gets overlooked when the owner has different priorities.
Although there are some stories of angry owners vandalizing the foreclosed property that they invested their life savings into, more often are issues with opportunistic thieves. They remove plumbing and light fixtures, paver stones, and other readily accessible objects from an abandoned property.
Schedule a thorough inspection before you purchase if possible so that you know what you're getting. Your real estate professional specializing in distressed properties can connect you with an unbiased inspector. They will report on your potential new home and help you uncover any hidden costs lurking there.
For home sellers who want to accomplish the optimal results, it is important to remain open to negotiations with buyers. There are many reasons why home sellers should negotiate with buyers, and these include:
1. You can accelerate the house selling journey.
If your mission is to sell your house as quickly as possible, you should be open to negotiating with a buyer. Because if you can negotiate a home purchase agreement, you can move one step closer to concluding the house selling journey.
As you enter a negotiation with a homebuyer, it is important to keep your house selling goals in mind. At the same time, you should be willing to adjust your goals as needed. If you maintain flexibility throughout a negotiation with a homebuyer, you may be better equipped than ever before to enjoy a fast, profitable house selling experience.
2. You can reach an agreement that works well for both a seller and buyer.
If you find a buyer's initial offer to purchase your house falls short of your expectations, you can open up negotiations with this individual. Then, you and a buyer can work together to come to terms on a home sale agreement that suits both parties.
Of course, a negotiation with a buyer does not guarantee instant success. If you and a buyer cannot reach a home sale agreement, there is no need to worry. Even if negotiations with a buyer fail, you can wait for another offer to purchase your home that falls in line with your expectations.
3. You can get the best price for your house.
As a home seller, it is important to do everything you can to optimize your house sale earnings. If you negotiate with a buyer, you can increase the likelihood of getting the best price for your house.
Furthermore, home sellers should keep in mind that they have options during a negotiation with a buyer. If you are not satisfied with the progress of a negotiation, you can walk away from the negotiating table.
When it comes to negotiating a home sale, you may want to hire a real estate agent, too. A real estate agent understands the ins and outs of home sale negotiations and will do whatever it takes to help you achieve the best-possible results.
Typically, a real estate agent can handle a negotiation with a buyer on your behalf. This housing market professional will continue to provide status updates throughout a negotiation and do what it takes to streamline the house selling cycle. Plus, if you ever have concerns or questions during a home sale negotiation, a real estate agent can instantly respond to them.
Don't stress about negotiating the sale price of your home. If you are open to negotiating your house's sale price with a buyer, you may be able to speed up the home selling journey. Best of all, you could maximize the profit from your home sale.
