Tips to Get the Best Foreclosure DealsOn February 16, 2018 by johnny
In a market where foreclosure listings seem to be commonplace, looking for a foreclosed property becomes a lot quicker and easier. Or that’s what most people think – until they start searching.
With tons of investors willing to shell money on discounted properties, the best deals are often sold really fast. However, there’s actually something you can do about it. If you’re in Texas, for example, getting the best deals for foreclosed homes in Texas is possible by following these tips:
1. Look around your neighborhood
The best place to start looking for foreclosure deals is in your neighborhood. You should start researching for any available deals nearby. Make sure to take certain factors into account, such as the crime rate, frequency of foreclosures, etc. It’s also ideal to study your neighborhood’s appeal throughout the day and night.
2. Consider repair costs
Most buyers and investors often make the mistake of not including repair costs in their budget. If you want a foreclosed home in Texas at the lowest price possible, you should consider the repair costs. For example, if a property has a $150,000 price and requires around $15,000 worth of house repairs, make sure to look at any comparable properties around. If it would be worth around $180,000 including all repairs, then you’re looking at a property worth $180,000 for only $165,000 – that’s no doubt a great deal.
3. Try to pay in cash whenever possible
If you have the funds, make sure you pay for the foreclosed property in cash. Most lenders will favor cash transactions and will even offer amazing discounts. However, if you’re unable to do so, just make sure you get pre-approved for a house loan.
4. Don’t take part in bidding wars
Most agents will list foreclosure deals at lower rates in an attempt to grab the attention of investors and buyers. However, once buyers start competing, bidding wars begin. Don’t ever fall for it.
Bidding wars often cause foreclosed properties’ prices to skyrocket, and the winner will end up paying more than the property’s actual market value. Instead, research on how much the property is really worth based on the comparable properties sold in that area. There are also cases when the foreclosed property has a higher value than the listing price but can still be considered a good deal. This is why it’s important to work with your agent and perform a market analysis to estimate a home’s value.
5. Avoid lowballing properties that are recently listed
Don’t make lowball offers on a foreclosed home in Texas that has been posted for just a few days, especially when it’s bank-owned. While banks offer competitive pricing, they won’t just give their properties away. On average, banks won’t lower the price on their listed properties that are on sale for less than 90 days.
However, it doesn’t mean you just have to wait until they lower their price. The best step is to wait and check back regularly, at least once a month, to check if the property is still available for sale. If yes, then it’s likely that they will lower the price.