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A Quick Guide to Purchasing a Foreclosed Home

There's No Such Thing as Too Much Research
Experts agree that if you're interested in purchasing a foreclosed home, it's important to do research on prospective homes in the area as well as the foreclosure process. Start by searching public records for a lis pendens, also known as a "lawsuit pending". This is the best place to begin to track a foreclosure process. It's also important to research methods and procedures since it varies from state to state. Florida, New York, Ohio and Pennsylvania all require judicial foreclosures--when a lender takes a borrower to court. In other states, the process can take place outside the court. For information on your specific state, check out United States Foreclosure Laws.

HUD Housing
A HUD (Housing and Urban Development) home is a dwelling acquired by the U.S. Department of Housing and Urban Development due to a foreclosure on a FHA (Federal Housing Administration) mortgage. Once acquired by HUD, the home is sold in an attempt to recover foreclosure losses. If you're interested in purchasing a HUD home, check out the National Home Management Solutions (NHMS) for a listing of HUD homes in your state.

Bank-Owned and REO Homes
Bank-owned and real estate-owned (REO) homes come into the possession of a lender—in this case, the bank—during the foreclosure process. An REO home is a type of bank-owned home that has been through an unsuccessful auction. If you're interested in purchasing a bank-owned or REO home, search for a listing of homes at Bank Owned Properties.

Inspections
It's important to get a foreclosed home inspected. These homes are sold as they are—with no extra compensation or repairs. Paying for a portion of a foreclosed home in cash is typically a great option; however, there are HUD homes that do qualify for FHA (Federal Housing Administration) loans.

For more information on purchasing a foreclosed home, contact your local agent today!

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