I see a lot of tax sales advertised, and wonder what the "ins and outs" are of buying that kind of property. How does that work? Do you buy the property and take over the mortgage? If not, what happens to the mortgage, since the bank/mortgage company is a lienholder? Same with land purchases - If someone wanted to buy a couple acres at a tax sale, what do they need to be aware of?
I heard there are hundreds of foreclosures every month. There must be some good buys there. Also heard that realtors actually make MORE on a foreclosure sale. Realtors? Is that so? How does a buyer find out about foreclosures?
Insighs, websites, opinion even - all welcomed! "
Where do you see them listed? Most tax sales properties in Wake County are properties that no one will take for various reasons. It is a real dismal lot. Many can't be sold because they don't have access to a road.
With all the 100% financing going on, banks need near retail price for a compromised property. Where's the value in that?
There are few bargains in foreclosures for the average person. NEVER buy a foreclosure on a shoestring. It confuses people when I tell them, "Foreclosures are for rich people."
I think that is very true. Most folks who lose their home through foreclosure
do not have money for upkeep and maintenance, so repairs can be staggering.
To buy a distressed foreclosure, you should have $20,000 or so cash working money, after your down payment and closing costs.
You will be buying a home that the Seller will not repair. Many foreclosures require that you do all inspections prior to making an offer and allow no repair contingency. This puts your earnest money at risk.
Some folks trash the place while leaving. I mean really trash the place. I have seen tobacco spit on walls and floors, burn marks where cigarettes were allowed to burn out on carpet and vinyl floors, fixtures smashed and ripped out, you name it.
And if they can't make a $1000 mortgage, they aren't going to make a $1000 roof repair. MOLD! ROT!
If the home is 8 years old, or older, you should assume you will be doing mechanical systems work. If the furnace is left, that is. I have been to houses where the gas pack or outside AC unit was carried away.
Every now and then, a heart-breaking foreclosure will hit the market. You can see that the folks loved their home and kept after it even when they couldn't make the mortgage payment and knew they would lose it. I really feel for them. But there aren't many of them.
Many foreclosures allow the Buyer's agent to write in the commission, so the commission rate can be anything, as long as the bank nets the amount they want. Now banks have gotten smart and won't allow an agent to be the buyer and also take a 10% commission.