Pre-foreclosure Versus Foreclosures – Pros of the ‘Pre’
It’s unfortunate but foreclosed homes currently represent half of all of all the homes sold in the US. Before the bank forces foreclosure there is in a period called pre-foreclosure which can last anywhere from two to twelve weeks. Many of the real estate gurus have made a fortune on pre-foreclosures and consider it as one of the best, if not the best, way to invest in real estate.
A lot of times the banks don’t want to deal with having to foreclose a home, so they will allow the owners to sell it during the pre-foreclosure period. You can get a great bargain in buying a pre-foreclosed home.
Here are some of the reasons many real estate professionals prefer purchasing a pre-foreclosed properties rather then waiting until they reach foreclosure:
- Pre-foreclosed homes are often sold for less than foreclosed homes. To avoid credit problems a homeowner is motivated to sell their home before the bank takes possesion.
- You will have the opportunity to ask the home owner questions concerning the home.
- Because the masses are more aware of where and when the government auctions are happening there are not as many investors competing for a pre-foreclosure property.
- More time to consider your finances before making the decision to purchase a home.
- Many people can become more emotionally driven during bidding and pay more then they had intended to.
- You can bring an inspector along with you to inspect a pre-foreclosed home.
- You will be allowed to make a low down payment on a pre-foreclosed house. This is not the case at a foreclosure auction.
Always check to make sure that the pre-foreclosed home you’re interested in has no liens or judgements against it. You should also bring along someone to inspect the home for you so you’ll know of any problems. The risks in purchasing a pre-foreclosed home are similar to purchasing a home the traditional way, only a lot less expensive.
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