Buying Condo Foreclosures

Every bust creates a boom, and right now, sales of foreclosed condos are the next big trend. With the number of foreclosed homes rising, the market provides plenty of opportunities for condo investors and first-time buyers. But consumers should always be careful when buying foreclosures. Always do your homework before plunging into a riskier market.

A recent Money Magazine article provides tips for anyone considering purchasing a foreclosed home:

Use the Web
Websites let you do a free search for so-called real estate owned properties (those for which the bank holds the deed) in several major cities (including Chicago starting 6/26). Other sites, such as Foreclosures.com and RealtyTrac.com, let you search nationwide for a monthly subscription fee.

Use a broker
A real estate broker can help you navigate the sale of a foreclosed home, through the bank or at auction. Once you’ve identified which properties are REO, you’ll know those are the ones for which a lower offer is more likely to be accepted.

Watch out for other costs
Never buy a foreclosed property without an inspection, and be sure to factor repair and remodeling work into your offering price. Many bank-owned homes need work, as their prior owners may have neglected maintenance in the face of foreclosure. And make sure the property has a clean title; any outstanding liens will be transferred to the new buyer.

For more tips, check out this article from Forbes on profiting from foreclosures.