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The real estate market offers many new opportunities to buy homes, here are some tips for purchasing a home at an auction

 

The market for foreclosed and bank owned home has created opportunity for buyers and sellers to acquire or sell homes via auctions.

The collapse of the housing market has brought many innovative programs into the main stream real estate market. One of the most popular is the idea of purchasing a home via auction. This concept has been around for a number of years but has gained popularity as lenders look to reduce their inventory of foreclosed homes. As a potential home buyer this may present an opportunity to purchase a new home at up to 50% off of its traditional market price. The main challenge in this scenario is the home financing. Almost every property that is sold via auction is sold "as is" the buyer has the responsibility of closing on a home that may need some potential work done in order for the lenders underwriting to approve the purchase. Most banks require a deposit of at least five thousand dollars to accept a buyers bid via auction, and this money is non refundable. In addition, many purchase contracts are worded that a buyer who does not close on the specified date is required to pay a penalty, often as much as $100 per day. The most important thing to be aware of if you are purchasing a home via auction is the properties condition. If you have any concerns that the home may not qualify and you don't have the funds or ability to make the repairs prior to closing, you are better off purchasing a different property and walking away from that home. If you are planning to buy homes exclusively through an auction, find out what requirements your lender may have in place regarding the property condition, prior to making a bid.

3-29-2008 ? LoanNetwork.com

 

 

 

 

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