Home » Real Estate » Buying

Buying a Foreclosed Property: What's Going to be Left Behind?

Aug 8, 2008
Foreclosures are at record levels in this country and there are deals to be had as banks try to unload houses back into the market and recoup some of the money that the previous owner failed to pay back. However, foreclosures are not for the faint of heart. There are messy details, issues with the former owners and the problems associated with buying a house that hasn't had the repairs and maintenance kept up over the past few months/years. Foreclosure homes can be a good deal for someone prepared for the dark side of foreclosure investment, but many people are still caught unawares by the lesser known pitfalls.

Homes that have gone into foreclosure are often in some distress for months or years before they are actually sold to new owners. A homeowner concerned with just making the mortgage payment is going to put off having the pipes fixed or the roof replaced. Insist on a full home inspection, roof inspection, etc. The money you spend on these is going to save you a lot when you know that there are no termites threatening to collapse the structure or a roof that is going to crash into the living room.

Be aware of hidden liens that the seller "forgets" to tell you about. A second mortgage may go into default, leaving the first intact - and needing to be paid. There are also issues like legal disputes that some former homeowners will walk away from, leaving you to deal with the problems. The same goes for houses that have been declared nuisance properties and/or have been the target of legal action to force the owners to clean them up. You might be liable if you don't immediately start renovating.

Homes that look nice upon first inspection can be victims of the former homeowners or vandals removing fixtures and/or completely stripping the house of all appliances, fixtures, and even elements of the house itself, like copper wiring and wood. In some cases, in a fit of misplaced anger, the former homeowners try to damage the house out of no other motive than to cost the new owners time and money, not to mention dismay. Some owners will even leave pets behind to starve or attack unsuspecting realtors, inspectors, or new owners.

Legal action against former homeowners are also difficult - if they didn't have the money to pay the mortgage, they probably don't have any to pay for court-ordered restitution. However, as the number of foreclosures skyrockets, home owners insurance companies are starting to get ruthless about prosecuting people who vandalize the houses they are forced to vacate.

The law varies from state to state on how long a former owner can remain on the property after it has been sold. Some states allow redemption periods, where the former owner can, if possessing enough capital, buy back their house for the price that it went at auction or higher. This is an uncomfortable piece of legislation for new owners who are not aware of this law and merrily start renovating; the former owners could buy back the house right from under them.

A very difficult situation occurs when the former homeowners refuse to leave the property. At this point, owners may be dealing with desperate people who don't have much more to lose. Don't try to force your way onto your property if the person is belligerent or aggressive. Document all contact with the former owner and any other people who might be living on the property. Contact a lawyer that specializes in real estate for more information on how to handle things in your state and county.

Your good fortune in finding a house that is priced very moderately is someone else's bad fortune. By all means, have sympathy for the people who are having to relinquish their house and face financial issues as a result of defaulting on their loan. However, do not let this turn you into a free hostel or acquiesce to unreasonable arrangements. They failed at paying their loan and, whether or not they are a "hard luck" case, they will have to shoulder the consequences. You're already doing them a favor by shouldering the mortgage.

A foreclosure often comes about with a lot of distress on the part of the former home owner. Make sure that this distress is not targeted at you through the treatment of the property. If you invest in a foreclosure, make sure you're prepared to deal with the less appealing side of these properties.
About the Author
Joshua Keen is an Atlanta GA real estate agent with Real Source Brokers. To search for new homes for sale in Decatur, visit RealSourceBrokers.com. This site is easily the most developed and useful Intown Atlanta real estate resource online.
Rating:
Please Rate:
(Average: Not rated)
Views: 422
Print Email Report Share
Article Categories
    • Artists
    • Gambling
    • Humanities
    • Humor
    • Movies
    • Music
    • Photography
    • Tattoos
    • Television
    • Classic Cars
    • Motorcycles
    • Recreational Vehicles
    • SUVs
    • Trucks
    • Vans
    • Branding
    • Business Opportunities
    • Careers and Jobs
    • Corporate
    • Customer Service
    • Direct Mail
    • Entrepreneurship
    • Ethics
    • Financing
    • Franchising
    • Home-Based Business
    • Human Resources
    • Import and Export
    • Leadership
    • Management
    • Market Research
    • Marketing and Advertising
    • Negotiation
    • Network Marketing
    • Networking
    • Organizational
    • Presentation
    • Project Management
    • Public Relations
    • Small Business
    • Strategic Planning
    • Team Building
    • Telemarketing
    • Training
    • Data Recovery
    • Databases
    • Games
    • Hardware
    • Networks
    • Operating Systems
    • Programming
    • Security
    • Software
    • Spyware and Viruses
    • Ask an Expert
    • College and University
    • Home Schooling
    • K-12
    • Languages
    • Online Education
    • Psychology
    • Accounting
    • Credit
    • Currency Trading
    • Debt Consolidation
    • Insurance
    • Investing
    • Leasing
    • Loans
    • Mortgage
    • Mutual Funds
    • Personal Finance
    • Stock Market
    • Structured Settlements
    • Taxes
    • Wealth Building
    • Coffee
    • Cooking
    • Gourmet
    • Recipes
    • Wine and Spirits
    • Acne
    • Aerobics
    • Alternative Medicine
    • Beauty
    • Cancer
    • Cosmetics
    • Depression
    • Diabetes
    • Diseases and Conditions
    • Fitness Equipment
    • Fitness
    • Hair Loss
    • Heart Disease
    • Medicine
    • Men's Health
    • Muscle Building
    • Nutrition
    • Skin Care
    • Supplements and Vitamins
    • Weight Loss
    • Women's Health
    • Yoga
    • Arts and Crafts
    • Babies
    • Collecting
    • Elderly Care
    • Genealogy
    • Hobbies
    • Parenting
    • Pets
    • Pregnancy
    • Woodworking
    • Feng Shui
    • Gardening
    • Home Appliances
    • Home Security
    • Interior Design
    • Landscaping
    • Affiliate Programs
    • Article Marketing
    • Auctions
    • Audio
    • Banner Advertising
    • Blogging
    • Broadband
    • Domain Names
    • E-Books
    • E-Commerce
    • Email Marketing
    • Ezines and Newsletters
    • Forums
    • Internet Marketing
    • Link Popularity
    • Pay-Per-Click
    • Podcasting
    • RSS
    • Search Engine Marketing
    • Search Engine Optimization
    • Security
    • Social Media
    • Spam
    • Video
    • Viral Marketing
    • Web Design
    • Web Development
    • Web Hosting
    • Copyright
    • Cyber Law
    • Intellectual Property
    • National, State, Local
    • Patents
    • Regulatory Compliance
    • Trademarks
    • Baseball
    • Basketball
    • Boating
    • Cycling
    • Extreme Sports
    • Fishing
    • Football
    • Golf
    • Hockey
    • Hunting
    • Martial Arts
    • Running
    • Scuba Diving
    • Soccer
    • Swimming
    • Tennis
    • Dating
    • Divorce
    • Marriage
    • Weddings
    • Astrology
    • Buddhism
    • Christianity
    • Faith
    • Hinduism
    • Islam
    • Judaism
    • Meditation
    • Metaphysical
    • New Age
    • Cable and Satellite TV
    • Cell Phones
    • Communication
    • Gadgets and Gizmos
    • GPS
    • Satellite Radio
    • Video Conferencing
    • VoIP
    • Addictions
    • Coaching
    • Goal Setting
    • Motivational
    • Stress Management
    • Time Management
    • Clothing
    • Electronics
    • Fashion
    • Gifts
    • Jewelry
    • Causes and Organizations
    • Environment
    • History
    • Holidays
    • Men's Issues
    • Nature
    • Philosophy
    • Politics
    • Women's Issues
    • World Affairs
    • Air Travel
    • Camping
    • Cruises
    • Destinations
    • Outdoors
    • Article Writing
    • Book Reviews
    • Copywriting
    • Fiction
    • Non-Fiction
    • Poetry
    • Quotes
    • Screenplay
    • Tools and Resources