Foreclosures present unique investment opportunities for buyers with lots of cash and a willingness to pay for essential improvements. Under ideal conditions, it may be possible to get a quality home at a price that’s far below market value. Unfortunately, however, these properties rarely come without a lot of risk. Before attempting to purchase a foreclosed home, it is vital to understand what the related risks are and to know how to mitigate them.
Standing on the Shoulders of Giants
If you’ve never purchased a property before, it’s important to pay attention to what other more seasoned investors are doing. If savvy investors appear to have dismissed a property, it could be that they know something you don’t. When buyers find appealing homes at extraordinary prices, it’s important to find out why others have written off an Irvine home for sale. It could be in the wrong location, too damaged, or simply too expensive for what buyers are getting.
Buying a Home As Is
Foreclosures are typically bought in an as-is condition. This means that you won’t have any real recourse if any major problems arise including roofing or foundation issues. If you can nab an attractive property at a super low price, this could give you more room in your budget for essential improvements and repairs. However, buyers always have to consider the fact that their out-of-pocket spending will invariably be much higher than the actual purchase price of their new homes.
Getting a Foreclosed Home Financed
If you’ve been unable to get a loan approval for a traditional home purchase, foreclosed properties could be right for you. Lenders can and often do finance these sales. Getting a foreclosed property approved by lenders, however, will take time and could be a frustrating endeavor. Lenders are reticent to fund the purchase of new homes when the risks of doing so appear to exceed the benefits. If a seller is able to provide legal proof of the property’s current condition and past maintenance, it may be possible to have the funding process expedited. Moreover, when homes are in pre-foreclosure, sellers might be willing to assume responsibility for some or all of the necessary repairs.
Why Foreclosures Could Be Worth Considering
With plenty of time on your hands and a willingness to shop around and do the necessary research, foreclosures can open the door to a vast range of possibilities that your budget didn’t previously allow. It is possible to find foreclosures in nearly all neighborhoods and price points. There is also the potential to find foreclosed homes with little to no damage and at very reasonable prices.
To find homes or condos for sale in Irvine in your price point, turn to Irvine Residential Living. We specialized in local real estate and help buyers align their purchasing plans with long-term financial goals. Give us a call today at (714) 454-6304 to schedule an appointment or showing.