Five Things Buyers Need to Know About Buying Foreclosures in Hampton Roads
Foreclosed homes can be a gold mine. But buying foreclosures in Hampton Roads is not to be taken lightly. While these types of properties have a serious potential for producing profits, they should also come with warning labels, as there are risks involved. Novice buyers could fumble over many details, losing time and money. There are five things buyers should know before entering the world of REOs and auctions.
1. Investigations are necessary.
Before purchasing, buyers should check for problems and troubleshoot future issues. Foreclosed homes need a background check, or due diligence, along with an inspection from a certified home inspector. Checking to make sure clean titles are available and no liens are attached are some of the responsibilities that come with buying foreclosures in Hampton Roads.
2. Bargains may not be around every corner.
A courthouse auction environment can be similar to a feeding frenzy. Some people become so hyped up at getting a deal they wind up overbidding, paying more than retail price- great for the bank, but not too nice for the buyer. Before bidding or submitting a written offer on a foreclosure, buyers must have done their research; they should know exactly how much a property is worth in its current condition and have a legitimate estimate of its value after repairs and updates. Foreclosed homes don't come with a balance sheet, so prospective buyers must determine the accurate fair market value to see if each purchase makes financial sense in Hampton Roads.
3. The most successful foreclosure buyers don't go it alone.
Buying foreclosures in Hampton Roads is not easy; it takes time, effort and a certain skill set that not everyone has. Nine times out of 10, the people who buy foreclosed homes for a living, or those who are successful in this business, have help. Our agents have industry knowledge and know how to put winning foreclosure deals together. These professionals have community connections and a wealth of resources at their fingertips. Using a seasoned expert to help ensure a good outcome just makes good sense.
4. Financial obligations must be met.
Typically, there are no creative financing strategies used when buying foreclosures. Auction rules often stipulate winning bidders pay in cash. When buying foreclosed homes that are bank-owned, or REOs, banks usually require proof of funds. Additionally, buyers should be able to afford the costs of improvements and repairs, which are sometimes needed to make properties inhabitable.
5. Realistic expectations are important.
Can money be made when buying foreclosures? Absolutely! Can anyone become a millionaire overnight snapping up foreclosed properties? Technically yes, but this scenario is a rarity. Just like any other endeavor in life, the foreclosure business takes dedication. Before deciding to dive into buying foreclosed homes, outline attainable goals you hope to accomplish with each project. Buying foreclosures in Hampton Roads can be a great way to increase net worth; start slowly and enjoy each step taken in the right direction.