Foreclosures

Is Buying a Foreclosure Right For You?

With the recent plunge in housing prices, Arizona has become the mecca for investors and first time home buyers to purchase a property.  Most buyers have opted to go the foreclosure route in search of a great deal.   It might surprise you that foreclosures are not all that difficult to buy.   The process is not really any different than buying a home not in foreclosure.

The first difference is that when you buy a non foreclosed property, you are able to negotiate with the seller to fix items in need of repair that were discovered during your inspection period.   When you purchase a foreclosed/bank owned property you must be willing to buy the home in “as is” condition.   This means that the bank/seller is not willing to fix any items you may find during your inspection period.   There are rare instances that the bank may fix major issues but this is not the norm.  You need to go into the transaction with the mindset that the seller will not fix anything.  There are many foreclosures that are in great condition and will not need much work.  Most foreclosures will need new paint, carpet and other cosmetic things.

Another difference is that when you place an offer on a bank owned property you will submit an offer using a purchase contract approved by the Arizona Association of Realtors.  If the seller accepts your offer, they will require you to sign their bank addendums that will overwrite any terms and conditions you submitted with your original offer.    It is very important to look over these documents closely since they may have different time lines that must be followed.  If the time lines are not followed correctly and you decide you wish to not purchase the property, your earnest money could be at risk.

If you’re going to buy a foreclosure, it is very important to work with a Realtor that has experience working with the banks.  The Schude Group sells more bank owned properties than most agents.  We are happy to discuss in detail the other differences of buying a foreclosure with you.   Please contact us at 480-201-9593.

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