If you have ever thought about buying a foreclosed home, you, no doubt, were charmed by the super low prices at which foreclosed homes tend to be available, but buyer beware; low prices come with a catch.
Most importantly, keep in mind that not all foreclosures are the same. There are three phases a foreclosed home passes through as regards a new buyer, each with its own series of benefits and drawbacks. First, the house is listed as a short sale property. A short sale means that the lender has agreed to accept an amount less than the total mortgage due on the property. This usually occurs during the first 90 days a property is in default. In this phase, you are actually negotiating the sale directly with the owner, albeit with the approval of the owner’s lender. On the plus side, the costs associated with purchasing a home in this phase are much lower than subsequent phases. However, there are downsides. There is a high degree of uncertainty as short sales can fall through if the owner comes up with the money. In addition, the process to purchase a short sale takes much longer than a regular home purchase.
Click Here to Read: Buying a Foreclosed Home: 3 Stages and Their Effects on You, the Buyer...
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