Buying Foreclosures in Atlanta
As you seek to find Atlanta real estate bargains, you will find that there are several options to choose from. Foreclosures and short sales are common just about everywhere in the U.S., and Atlanta is no exception. If you are thinking of buying foreclosures, here are some factors to consider.
What are foreclosures?
Before you jump on the foreclosure bandwagon when buying a home in Atlanta, you want to start by making sure to have a firm understanding of what a foreclosure property is. A foreclosure property refers to real estate that is being sold because the homeowner was unable to make their mortgage payments. Basically, when a homeowner defaults on his or her loan payments, the lender/bank takes legal measures to take possession of the home in order pay off the balance of the loan A.S.A.P. In many cases, because the bank or lender is more interested in selling the home for the amount that is stilled owed on the loan (in order to avoid monetary loss), these homes may come with a discounted price tag.
What to consider when buying foreclosures
If you find Atlanta real estate deals in the form of a foreclosure, your first reaction may be to quickly make an offer before it's too late. However, before you do, make sure that you do the proper research to avoid any unwanted surprises.
First, homes that have been foreclosed on may not be in the best condition (because the former homeowners will have already been asked to vacate the property). What's more, foreclosures are almost always sold "as is." It is common for the owners to leave the home in disrepair before they leave because they have little incentive to take responsibility for its upkeep. In extreme cases, some of these foreclosures (i.e. REOs) will be left vacant for several months and neglected by banks, leaving the door open for vandals to steal copper plumbing. Make sure you know the condition of the home you are interested in and what repair costs will be.
Second, it is possible that there are additional liens against the home outside of the primary mortgage. In many cases, homeowners who were not paying their mortgages might have also been behind on their taxes. Some will have had secondary loans that they took out against their equity before they went into default. Do your homework before buying a home in Atlanta so you will be able to avoid homes that may have these issues. Your local courthouse or county records office will have most of this information available to you. Simply let them know the address of the property, and they will help you find the information you need.
Keep in mind that financing for foreclosures may be different compared to a traditional home purchase. You may not be able to get FHA financing for example. Before you start looking into buying a home in Atlanta and searching for foreclosures, take the time to get your financing in order.
How to buy foreclosures
When buying a home in Atlanta that is a foreclosure, you can make an offer with a real estate agent or you might make your purchase at an auction. In the case that you attend an auction, you will need to have cash (in other words, have your mortgage approved) to make the purchase, and you will need to be present on the day of the auction to make your bid. Also, you want to make sure you check for any liens that may be against the house before bidding, as they could become your responsibility if you win.
Why you should consider working with a real estate agent
Although it is not required, it is highly recommended that you seek guidance from a real estate agent - more specifically, a buyer's agent. It may be to your benefit that you reach out to a buyer's agent rather than a listing agent because listing agents have a fiduciary duty to the banks or lenders who are selling the home, and oftentimes, they have never physically visited these foreclosed properties themselves. This is because during the last housing crisis, these major banks and lenders took possession of an immense volume of foreclosures, so it is unlikely that they had the chance to inspect, let alone visit each and every one of these foreclosure properties, so they are probably unaware of the current condition of the property you may be interested in.