Foreclosure 101

I saw a couple of foreclosures this week, one in Leander and one in Buda. Although you can get a good deal with a foreclosure, a buyer needs to beware of what they don’t get. A foreclosure contract contains an addendum about a mile long that basically states ‘buyer beware’. You are buying the house in the condition that it is in…and the bank doesn’t guarantee anything about the condition. A Seller’s Disclosure Notice is not required for a foreclosure, because the bank is the Seller.

You get a 10-day no-fee option period with a foreclosure to do inspections. I recommend a few, which might include a septic and well inspection. Yes, you could easily spend $1,000 or more on inspections. I had a client ask me last week: “Do I get that back if I don’t want the house?” I replied “No, but wouldn’t you rather waste $1,000, if it winds up saving you $10,000 or more later?” Depending on the price…you might be fine with that. My point is if you do your homework upfront, you know what you are getting into.

I support local Austin; after all I think it’s only neighborly.