Foreclosures: What You Need to Know

Roadside signs and online ads can commonly be found stating things like, "We buy houses." These ads are typically from real estate investors looking to obtain a discounted property, such as a property heading into foreclosure. A foreclosure, often referred to as a REO or bank owned property, is a type of distressed property that has reverted back under the control of the original lender. Real estate investors and discount home buyers often seek out these types of properties as an alternative to paying higher prices on traditional retail properties. In many cases, a foreclosure property will be sold at or below market value. In some situations, however, they will be sold for well above market value. For this and many other reasons, those who are interested in purchasing foreclosure properties should become familiar with the way foreclosures are transacted before attempting to invest large sums of money in this type of asset.

Common Types of Foreclosure Sales

There are two primary methods of buying foreclosures. Either a person can buy a foreclosure through a real estate agent or through public auction. If a person is looking to buy a foreclosure through a real estate agent, then it is generally a good idea to make sure the real estate agent they are working with specializes in this type of real estate transaction. On the other hand, a person can just as easily bid for foreclosures at public auction in the county where the property resides. Most public auctions, involving REO properties, are either held online or in a manner designated by a given state's real estate laws. Since you are not an attorney, you should read through the laws governing foreclosures for the state in which you are interested in engaging in real estate transactions.

The Downside of Public Auctions

The downside to buying foreclosures at public auction is that real estate investors will sometimes bid properties up above retail market value. This can become a problem for people interested in making a return on their investment. Another downside to public auctions is that the bank or lender is generally not required to make any guarantees, and the property will likely be transferred by way of a Quit Claim deed, rather than by a Warranty Deed. It is generally a smart idea to do research into the different types of property deeds. You will want to know what it means to come into possession of a given deed type for a foreclosure property before you commit to buy.

Title Search and Title Insurance

In a lot of foreclosure cases, people imagine that they will save money if they skip the step of having a title company run a title search on the property. This is a very risky and reckless practice. When you pay for a title search, the title company is actively and laboriously looking for any clouds on the title that could come back later to pose a problem. Purchasing title insurance also helps to protect a property owner if any missed title issues lead to legal action against the new owner of the foreclosure. For example, the bank or lender of the property may not have had true ownership of the property before it went to public auction. In such a case, the individual or entity on the chain of title that can prove they have an unresolved interest in the property can sue for damages. Without title insurance to protect the owner of the foreclosure, this will typically leave the new owner with a huge financial loss that could have been avoided.

Conclusion

Although buying foreclosures is a great way to pick up properties at a discount price, a person should always be aware of the issues involved to mitigate any risks. Understanding state laws and taking all necessary precautions will generally lead to a profitable outcome for a savvy individual trying to purchase foreclosures. Those who learn to make a sizable income in foreclosures will often see the value in employing ads that say, "We buy houses," to help them earn more profits in the foreclosure market.

So You Think You're Ready to Buy a Foreclosure Property?

1. Time. Make sure you've got enough of it to spare.

Buying a property below market value will come at a cost, perhaps other than an immediate cash cost, but it will cost you. The process involved in buying a foreclosure will usually take up to two months of your time before you know you've got the property, while keeping you on the hook and unable to act on any other property in the meantime. Once you've had an accepted offer on a foreclosure property, your deposit gets cashed into a trust account right away. However you won't know you've got the property till approved by court. Times could vary but 4-6 weeks is a standard timeline for a court date to take place after an initial accepted offer. Now the best scenario is there are no competing offers and the new home is yours (allow 3 more weeks for possession). If there are competing offers and you do not wish to bid extremely high or simply did not realize someone would bid so high for this property, you've just lost on this property and will have to wait a few more weeks for the deposit to be returned back to you.

2. No guarantees by seller.

In an ordinary real estate transaction, the seller is responsible to deliver the property in the same condition as originally seen by the buyer. When buying a foreclosure, the seller offers no guarantees whatsoever.

That means the only deliverable on possession date is 4 walls still standing (even if those weren't there the seller would probably successfully argue in court that they carry NO responsibilities whatsoever). So if you get the keys to your new home on possession date and find all the appliances are gone and with granite counter tops ripped out... well, you have no one to go after and bear all the costs yourself.

3. Property has been vacant for too long.

Even if you had an inspection done, your new home likely has not been lived in for quite a while. That means, a small leak, that an inspector has not picked up on, could have originated and gone completely unnoticed since no one lived in there for so long. You'll only discover that small leak if you've been running the water for a long period of time. By then you could be flooding your neighbors. This goes on to say that all homes must be insured on possession date, but foreclosure properties especially!

Remembering these three simple points when buying a foreclosure could lead you towards a very successful purchase of a beautiful home at below market prices!

Make the Best Garlic Mashed Potatoes With This Recipe

To prepare mashed potatoes, all you have to do is peeling, boiling, and adding some ingredients and then mashing. You can also leave the shells to vary the flavor. If you want to know how to make mashed potatoes, only follow these kinds of steps.

Recipe

1. Put the water in a large pot heat.

2. Wash and peel the potatoes. Chop it so that they are in equal portions and make evenly.

3. When the water boils makes it and let cook for about half an hour, until soft.

4. Remove a little broth and potatoes passed through the food mill. Throw back to the pan and put over low heat.

5. Add the milk, cream and butter. Stir to mix well and finally ready to take.

Ingredients

1 1/2 pounds Yukon gold potatoes
1/2 teaspoon salt
2 teaspoons butter
1/2 cup milk
Salt to taste
Pepper to taste
4 sprigs of parsley for garnish

Prepare Mashed Potatoes

Step 1

Peel the potatoes. After you wash it thoroughly in cold water, use a sharp knife or a peeler to peel the shell. You can also leave the potato shell Yukon gold or red-skinned potatoes if you like as well. But baking potatoes should be peeled.

Step 2

Boil it in a large pot of water. First boil the water alone and put some salt. The pot must be large enough to contain potatoes without bunching. Once the water begins to boil, add the potatoes and cook for 15-20 minutes or until soft. When ready, drain the water from the pot and transfer it to a plate.

Step 3

Mash it as soon as you have the other ingredients. Start to crush potatoes and 2 teaspoons melted butter and 1/2 cup milk. This will make them more tasty and creamy, well that will be easier to crush. A masher is ideal to crush the potatoes, but also can use a large fork, a spoon or a whisk.

You can also mash it with these tools: a garbage wire, stainless steel masher or an electric mixer.

Preparing another type

Step 4

Make it with butter. To this mashed potatoes, just put him unsalted butter and chicken stock to the Yukon gold potatoes.

Step 5

Make mashed potatoes with garlic. To prepare these tasty mashed potatoes, you can use any type of potato garlic. You can also add olive oil, Parmesan cheese and various other ingredients.