How to Find Bank Foreclosed Homes for Sale

Bank foreclosed homes for sale can get you the best bang for your home-buying or investing buck. However, anyone can find a foreclosure. It's buying a foreclosure that will make you money that is the real trick.

Difficulty: Moderate

Instructions

1. 
    

   LEARN THE SOURCES OF BANK FORECLOSED LISTINGS.
   
   A lot of internet sites want to sell you foreclosure information. You really don't need them unless you want to get into the riskier pre-foreclosure business. There are several free and easy to find sources of bank foreclosed homes for sale:
   
   - An aggressive realtor.
   - Regional MLS listings. If they are 80% of value, they are probably foreclosed.
   - County Assessor's Website. Search by owner for different bank names like 'Chase.'
   - Government sponsored foreclosure bidding sites.
   - Banks. Go to the bank themselves and ask for a listing of their foreclosed properties. They often even have keys at the front desk that you can check out to walk through a place. You'll be surprised.
   - The street. If you are targeting a neighborhood keep driving it. When the grass gets high, the place looks abandoned, and there is no for sale or rent sign yet... check it out with the Assessor or a realtor.

2. CHOOSE A TARGET NEIGHBORHOOD.
   
   Every investor has a niche market they target. Are you going to fix and flip? Then you want a growing home owners market with strong curb appeal, and rising home costs. Fix and rent? Then you want high renter demand near colleges, factories, or other nearby reasons. Overall, it is best to pick a neighborhood with rising values and high long term demand (unless this is a mix of profit and charity).

3. 
    
   Some Homes Look Like Coupons

   BECOME FAMILIAR WITH WHAT MAKES A DEAL.
   
   Buying foreclosed homes is not for the gullible or the weak of heart. Be sure you have a realtor who will shoot straight with you because she wants to keep your business, not just make a sale.
   
   Pick up any for sale fliers you find in your target neighborhood. Exercise through the neighborhood on foot or on your bike to slow you down (you notice more).
   
   Start getting a feel for how much a three bedroom one bath house with a single garage sells for. Get an idea of what a four bedroom two bath with two car garage sells for. Check out their assessed values online verses their offered values to see what the difference is.

4. ONLY BUY HOMES THAT YOU CAN FIX AND SELL.
   
   Even if you are renting. Your backup plan is to sell. Eventually you will want to sell. And why would you rent something out, that no one (even investors) would want to buy? Buy only what you can sell. If carpet, paint, and a few other changes will make a major difference go for it. If it will take as much money to fix it as there is extra value in the home, skip it. Get out your calculator before you buy and add up every single (yes every single) repair you anticipate making. Add on 10% of the total repair costs for good measure before you make your choice.
   
   Even if you are going to live there, you don't want the house to be worth less than what you put in if you have to move in two years and the economy dips ... then you get foreclosed.
   
   See tips and warnings below for more on bank foreclosed properties for sale.

Tips & Warnings

• Watch properties that are on the market for a while. If the signs change, it may have gone into foreclosure.
• Choose a realtor who has bought foreclosures themselves before.
• Check out related articles in the right hand sidebar above for more information on home buying.
• Always have an extensive inspection done and be ready to walk away.
• Know that the closing process will be unusually difficult with any foreclosure companies that get involved.
• Walk away from a foreclosed home that has significant structural damage.
• When in doubt ... walk out.

[botticelli728]

on 7/28/2009 Very detailed info. 5*