This one of the worst housing markets we have ever seen, but it also creates an opportunity to buy a home for an incredible bargain. With the right strategy, and some patience many people will be able to purchase a home they never thought they could afford.
Get Pre-Approved for a loan
This is an essential first step to take before you even begin to look for a foreclosure. Getting pre-approved for a loan will make you a qualified buyer and give you a firm understanding of what you can afford. Go to your local bank branch to get pre-approved for a loan or visit Bankrate.com to get an estimate of what you can afford. Remember with today's stricter credit standards you are going to need somewhere around 20% of the purchase price of the house to put down as a downpayment. This creates a safer lending environment for both you and the bank.
Find a Real Estate Agent
Buying a foreclosure can be a do-it-yourself project, but that is for the experienced buyer. If you are just getting started in buying foreclosure’s you will want to work with an experienced agent. Finding an agent can be difficult, especially finding one that understands the foreclosure process, but they can be found at a local real estate office. Interview a few agents before you settle on which one to go with.
Where to Find a Foreclosure
If you do end up going with an agent, then they should be doing most of the work in finding a foreclosure. However, if you plan on going at it alone there are still plenty of places for you to find a foreclosure. Check your state's Multiple Listing Service website, or go to MLS.com and click on the state where you are looking to buy a house.
Placing an Offer
Once you have narrowed it down to a specific house you are interested in it is time to place an offer on the house. Be sure to do some research on the area and neighborhood, and get a good idea of the value of the house. Some free websites that allow you to do market research for the area are Zillow.com or Trulia.com.
Once you have made an offer, and it is accepted, you will need to set up a closing date. This is usually 30 days from a formal agreement. With in those 30 days you will need to get an inspection done on the house to make sure it is in sound condition, and purchase insurance. The actual closing is the last step, and then you are officially a homeowner.
Buying a home will, for most people, be the biggest investment a person makes in their life. It can be a scary time, but with the right preparation it can be one of the most rewarding purchases someone can make. Remember it’s not just a house, it’s a home.
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