Dallas Foreclosure Realities

By dallasrealtor | October 27, 2008

In today’s market it seems as if everyone is looking for a good deal.  Who can blame them?  Home buyers who want a good deal in Dallas real estate typically look for foreclosures.  It’s the desire to own something for little or nothing.  Maybe they can fix a house up that has minor work that needs to be done or a house that needs something major like a roof.  If the prospective buyer is someone who works in the roofing industry or the plumbing industry it’s easy for them to inspect a home that needs that kind of work and ultimately fix the problem themselves.  This saves them thousands of dollars. 

The truth of the matter, in today’s market, is that Dallas foreclosures are in abundance, but the work that needs to be done to get them in livable condition is usually sizable.  It’s not always that a house goes into foreclosure and the homeowner continues to live in it and take really good care of it.  Unfortunately, that is not the case.  Foreclosure homes are many times in very poor condition.  A lot of times there is furniture still in the home that will need to be removed and the if it’s a pool home, you can just imagine what the condition of the pool will be. 

Now that the reality of a foreclosure home has been spelled out, one needs to consider whether or not this is something to pursue.  If so, there are a few things to keep in mind.  Foreclosures happen due to hardships.  The owners may have been laid off or fired from a job, they may have had medical problems, divorce or even a job transfer that prevented them from being able to continue to pay on their existing mortgage.  The purchaser of a foreclosure will need to review the proceedings.   Every state’s foreclosure proceedings vary.   In the case of an existing mortgage, home owners can end up staying in the property for up to a full year.

Investors who specialize in buying foreclosures often prefer to purchase these homes before the foreclosure proceedings are final.  There are drawbacks to this approach though.  The homeowner(s) are under the misconception that they will receive all of what they initially paid for their home or more.  They are shocked when the investor presents their offer and it’s about 60% of what they expected.  Sometimes the homeowner is insulted and is then not willing to speak to future investors regarding the sale of their home.

This can work the advantage of the non-investor.  For example, when approaching homeowners in foreclosure, the initial shock has worn off from the investor’s offer and they may be willing to lower their standards a bit concerning price. 

Whether you are an investor or a non-investor, do your homework first and make sure you know the situation prior to presenting an offer to a homeowner who is in foreclosure.  It will better your position when you come in prepared.  This can be a very lucrative endeavor if you know how to handle the situations.

Topics: Foreclosures | No Comments »

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