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In Every Tragedy, An Opportunity: Capitalizing on Foreclosures in the Myrtle Beach Market

Jul 22, 2008
It's no secret that the current housing market is a disaster for lots of home owners. Whether they got a "liar's loan" that they can't afford any more, or they were one of the people with a house "in the air" when the flipping craze crashed on them, there are foreclosures happening all across the US. Even in a market as dynamic as Myrtle Beach, there are people who can't keep up with their mortgages.

There are three stages in the foreclosure process a buying opportunity presents itself. The first, and the most painless for everyone (lender, current resident and new prospective owner) is early in the process, when they're only down a few payments. The bank doesn't want to foreclose, they need the liquidity, and the income stream from the mortgage, not the tangible asset of a home that's assessed at several hundred thousand dollars that they lack the expertise to unload. While this is the least advantageous for the new buyer, it's quite often possible to negotiate a new mortgage with a lender as a direct alternative to letting the house go up on auction. This type of intervention often works best if you go through your favorite real estate investor.

The second stage of buying a foreclosed (or distressed) property is through a foreclosure listing service; these list all the foreclosures that are going up on the sheriff's auction. The primary buyers tend to be Realtors, and the banks are desperately hoping to get either an income stream or a slug of liquid cash rather than (once again) be saddled with a tangible asset. You can often get a home (if you're not picky) for a very good price by going this route; however, your odds of getting a home that's already been "mostly paid off" are next to nothing, and you're probably not going to get the exact home you want; choice locations are going to get a lot of bids. This is another avenue to have a good real estate broker intervene on your behalf.

The third state is the scariest stage of all: A bank that has a LOT of foreclosed properties on its inventory list is in major trouble, and there are going to be banks in this situation over the next couple of years. There is a window where a bank can pull out of this by auctioning off assets. Expect to make significant down payments in this case; this situation happens when the local real estate market is seriously depressed. Don't expect to see this set of circumstances around Myrtle Beach. You are far more likely to find a distressed home in stage one than any other.

Myrtle Beach's housing market is one of the few that's actively growing in the US, and Myrtle Beach is the 6th fastest growing community in the country. It's a major travel destination and retirement location, with excellent beach access and golf courses, plus loads of family friendly fun. If you're looking to get into the Myrtle Beach real estate market as a homeowner, looking at a foreclosure re-sale can save you a lot of money, upwards of $100,000 or more, depending on which stage you get the home in.

That being said, always have a real estate agent on hand when you do deals of this kind, they're essential for spotting the hidden tricks and gotchas in the process. Make sure you avoid any hidden fees, or probate findings by having a professional look over the deal on your behalf.

Additional advice on buying foreclosed properties: Remember that the people who are moving OUT of your new house are going through a troubling time. Incidences of vandalism, poor maintenance and worse are all known. People take foreclosure very poorly, and some take it quite personally. Again, this is a situation where a real estate expert can help a lot, because they can talk to the current occupants and keep them from doing something foolish out of wounded pride or depression.
About the Author
Randy Zlobec, Search Engine Marketing Expert who also offers Article Distribution Services for a Myrtle Beach Real Estate company.
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