There has been a rising demand for foreclosed homes in the recent past which has affected the value of properties and forced municipal governments to work extra hard to avert homeowners crisis. Buying a foreclosed home is a worthy investment especially for first-time homeowners. However, extra precaution should be taken to avoid getting into dubious business deals with brokers. The following tips to buying foreclosed homes will help you make an informed decision when venturing into home ownership.
Consider your budget range
Do not be excited with small price tags when you want to buy a foreclosed home. Always stick to your budget and ensure that you get value for your money. Your budget should also include the cost of repairs and renovations if necessary. Before purchasing the property, you should consider the risk value associated with the asset. This should cover for periods that you will stay without a tenant if you are planning to rent or the operational costs if you are buying it for yourself.
Contract a private company to do inspection
A home inspection is a prerequisite before any purchase. Besides personal inspection, you should contract a professional company to do the inspection and assess the value against the asking price. The inspection should be current and detailed. One should not over-rely on previous inspections because the data may not represent the real value on the ground. There are cases where caretakers have stolen cabinets and fixtures after inspection. One should be vigilant enough to ensure that the inspection report is a true representation of what is on the ground.
Consider the duration which the house has been vacant
Experts say that the longer the duration which a house is vacant, the more likely are the damages. The other risk associated with houses that have been vacant for long is cumulative bills. One should check water and electricity bills for any cumulative charges before making a move. You should also check for plumbing, sewerage, or gas blockage before moving to such a house. More to this the yard may be a clear indicator of how long the home has been vacant. Watch out for untrimmed trees, dead branches on the roof, leaking ceiling. These are clear indicators that the house has been vacant for a very long time.
Contact department of housing and urban development
The department of housing and urban development has accurate data on foreclosed homes. Before you sign any deals, it is important to cross check the authenticity of the owner of the home and if there are any unpaid mortgages that are associated with the homes. This will help you to cushion yourself from making a risky investment.
Consider the neighborhood
A good neighborhood always adds value to your home. A neighborhood that is densely populated and has extensive foreclosures may not be appealing. Avoid foreclosure homes that are located in places that have high crime reports. You do not want to stay at a place where you are not at peace when you are away from your home. Look for a calm neighborhood that has social amenities that will make your stay stress free