Purchasing a foreclosed home is a good way to get a dream house at a reasonable price. However, it is significant to know what you are getting yourself into. In this post, Hanfincal shares information about how to buy a foreclosed home in Georgia.
1. Explanation Of A Foreclosed Home
When a house owner fails to pay their debt, the party who is possessed can take possession of the property, namely foreclosure. The term “foreclosure” is usually used more commonly to apply to a property in any stage of the process: auction, pre-foreclosure, and REO (real estate owned).
2. How To Buy A Foreclosed Home In Georgia?
How to buy foreclosed homes in Georgia? How to buy a foreclosed home in GA? Follow the simple seven steps to purchase foreclosed houses in Georgia at a lower price.
2.1. Get Financing Pre-approval
Financing foreclosures in Georgia rely on the stage the foreclosure is in. Commonly, conventional financing is not a selection at foreclosure auctions. Purchasers may borrow the money from a hard money lender or family member; however, people often buy these properties with cash.
Financing an REO foreclosure or pre-foreclosure is like the process with a conventional property. With pre-foreclosures particularly, ensure you schedule the sale before the foreclosed deadline. Besides, you can contact your lender and apply like you would for a conventional mortgage.
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2.2. Get A Real Estate Agent
Purchasing a foreclosure house in Georgia can be a complicated process, and that is why renting an agent with experience purchasing foreclosures can make the difference. They assist you in navigating the additional risks, avoid missing significant deadlines and negotiate with motivated sellers effectively.
Your agent may have a relationship with REO departments of regional lenders or other entities that deal with foreclosure houses. Having the inside track can be the difference between you receiving your dream house or not.
Many realtors only do one or two foreclosed deals a year; therefore, finding one with experience in this market will be a profound advantage.
2.3. Get A List Of Foreclosed Homes In Georgia
If you are an inexperienced purchaser, we suggest you concentrate on pre-foreclosures or REOs because they are more familiar with a conventional house purchase.
Properties in these stages of foreclosure are usually listed on the local MLS, which implies your agent is able to notify you of them before they take place on popular real estate websites.
If you are experienced in real estate, willing to take the risk of purchasing an unseen house, and have increased cash reserves, you can consider auctions. You can seek auctions in the legal notices section of your local newspaper, real estate.
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2.4. Review A Foreclosed Home
A profound benefit to purchasing REOs or pre-foreclosures is that you can visit the property before making an offer (this isn’t possible with auctioned houses). If you are new to upgrading and rehabbing properties, you should make an effort to see a property directly before filing an offer. Just know that you often will not get to; however, it never hurts to ask.
If you don’t have time to order an inspection, you can bring a contractor to get an initial sense of any considerable flaws with the property and what they will cost to fix. If your purpose is to flip the home, this will be vital for figuring out your ARV (after repair value).
2.5. Make An Offer
Making an offer on a pre-foreclosure is like making offers on traditional houses, hoping the seller is highly motivated and attempts to close before the foreclosure deadline. Consisting of fast close dates is the best way to make these offers attractive to sellers.
An REO often has more particular rules for submitting offers. Each lender treats this differently; however, you will want a pre-approval letter, and you should follow their guidance for submitting offers. A good agent can support you through the process.
Auctions have their set of regulations for submitting offers. Georgia purchasers must submit bids directly or online, relying on the property being auctioned. The auction will have minimum bids, predetermined bid increments, and occasionally purchaser’s premiums which are an additional cost.
Purchasers should contact the trustee managing the auction to guarantee they have these exact details before submitting an offer.
2.6. Conduct A Title Search
The most considerable thing to do when you purchase a foreclosure house in Georgia is to get the property checked and conduct a title search. As foreclosures are only available when bills are not being paid, there is the additional risk of claims against the title. Georgia is a purchaser-beware state implying sellers are not asked to disclose everything wrong with the property, and this makes due diligence even more significant.
Doing a title search will make sure that there are no liens against the property; therefore, you can rest assured that the house is yours once you have closed on it.
Checking will assist you in avoiding main problems in the property that might be difficult to see with a simple walk-through.
With auctions, checking and viewing properties are not allowed. Your due diligence will be restricted to inspecting for a clear title, driving by the property to evaluate the outside condition, and preparing to make an offer at an auction.
With the auction, you will need certified funds or cash (e.g., a cashier’s check) to close on the property and obtain the title. At the time you win the property, funds are due in full. The contract writer will take your payment and government-issued ID and complete a certificate of sale afterward. The deed will be transferred and mailed to you.
In the closing process for pre-foreclosures, REOs are familiar with closing on traditional houses. You head to a title company, fill out paperwork and pay the seller of the property.
The title company will tell you in advance what is expected from you; however, it supports having an expert on your side to instruct you.
How to buy a foreclosed home in Georgia? You can purchase foreclosures in Georgia by the seven steps above. If you don’t save enough money currently, some benefits and financial support are helping you buy a house at an affordable price. Hanfincal hopes you find the useful information we bring to you in this post.
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