Buying a Foreclosed Property

Many novice homebuyers are reluctant to purchase a home at auction on the court house steps and prefer the services of a Realtor when buying a foreclosed home. When a home is auctioned by the lender. Buyers bidding on a home at courthouse steps auction face a major buying caveat; not knowing the condition of the property. The home at the time of auction still belongs to the homeowner and is not open to public inspection and viewing.

How are North Carolina Mortgages Foreclosed?

Most foreclosures in N.C are non-judcial. Most of the mortgages in N.C. contain a power of sale clause. This type of foreclosure does not necessarily involve court action. Notice is served to the homeowner/borrower at least 20 days prior to the foreclosure action. The trustee of the property will auction the property to the highest bidder. There is a right of redemption period of ten days. During this time, the borrower can reclaim the property by making payment in full of the sum of all outstanding monies.

Major drawbacks include:

Most foreclosures are as-is
You will need the services of a good home inspector or general contractor to give you an accurate account of the condition of the property.

Rehabilitations costs may be underestimated.
You will need to make sure you have accurate repair estimates.

Buying without a pre-approval
Some lender addendums and contracts do not allow for financing contingencies. If you are unable to get financed, you may lose your
earnest money deposit.

Limited or no home warranty
You should purchase a home warranty.

Major advantages include:

Instant equity
Some foreclosures may need as little as cosmetic repairs such as paint, plaster, and carpeting to make a great home or rental property.  You may be able to purchase an outstanding property at 30 or 40% of market value.

Great way to build equity
Whether you are a home buyer and will occupy the home to someday sell or if you are an investor looking to rent the property and will
sell, you will build equity quicker than other homes in your neighborhood.  This will allow you to possibly sell quicker when you are ready and also walk away from
closing with higher net proceeds.  You can also take advantage of a home equity line due to the instant equity you will have in your home.

Make a great investment with free assistance
Unlike purchasing stocks and bonds with the assistance of a stock broker, real estate brokers experienced in
selling foreclosures will receive commission from the lender of the property or the Government if the home is a HUD home.  Take advantage of the free assistance when purchasing a foreclosed, HUD, VA or bank owned home.

Today's Real Estate & Auction can help you find pre-foreclosures and bank owned properties prior to the public listings.  We work with many banks and have over a decade of experience in the foreclosure and distressed property market. 

Take advantage of our free services to investors and home buyers.  Our clients receive email and phone blasts with each new buying opportunity before public listing on the MLS.  Our unparalled personalized service is unmatched.  Call us today at (704) 559-5988 to receive foreclosure and distressed sale property information.

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