Monday, 14 January 2019
Bargain shopping for a home is a little like bargain-shopping for anything else—you might have to work harder, scour the inventory a little longer and jump through some hoops, but in the end, you can net some significant savings.
Two ways you can pay less than the going rate on a property are by buying a short sale and by buying a foreclosure.
Though not as prevalent as they were during the housing crisis several years ago, these are still options for some buyers. You should also expect to wait longer for approvals; for example, the National Association of Realtors reports that in March 2018, short sales were on the market the longest at a median of 165 days, foreclosures sold in 56 days and other homes without mortgage issues took 51 days. Pursuing a short sale or foreclosed home is not an exercise a first time home buyer should tackle alone. Go with a pro, says BBVA Compass Senior Vice President Viola Solomon, who works in the Community Lending Mortgage division.
"From a lender's perspective, I would recommend the home buyer consult an experienced real estate professional who specializes in foreclosures and short sales. I would also recommend extensive research on the property and the neighborhood. That's important for any purchase."
Here's an explanation of these options:
Buyers should be hyper vigilant of the specific implications of buying foreclosed and short-sale properties. The real estate site Zillow offers these tips from real estate expert Brendan DeSimone about minimizing risks:
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