A lot of people wonder just how low will foreclosed cheap homes for sale actually sell for. Experts will tell you that it is not uncommon to get a bargain for up to half the actual market value. But the price tag would mostly be influenced by the prevailing market conditions at the time of purchase.
Discounts that can be had for cheap homes for sale also vary depending on whether the property is being sold before or after foreclosure. Pre-foreclosure homes can also refer to a set of properties collectively known as for sale by owner or FSBO. Lenders sometimes are able to persuade home owners who have defaulted on their mortgage to put up the property for sale to prevent the stigma of foreclosure. FSBOs offer a lot of perks like the opportunity to inspect the property at the prospective buyers leisure. This way they can get a better idea on the physical state of the property and gain insights in terms of repairs. Buyers also get enough time to conduct a title research on the property to turn up any and all liens or taxes still attached to it.
After foreclosure, these cheap homes for sale are then offered through a public auction, which works well for instant buyers. The winning bidder in an auction should have the ability to pay for the entire cost of the property immediately after the auction. When properties do not get sold at these auctions, they go back to the bank or the lending institution in the form of assets, at this point they become real estate owned properties. The bank will then offer it back to the market through a bank-appointed broker.
When buying cheap homes for sale one should always keep an eye out for potential savings. Say you have a good line to a contractor who you know can help you with repairs and renovation and will give you a friendly rate, then you may want to look into fixer-uppers or handyman specials. These types of homes are way cheaper than all the rest of the foreclosure homes in the market because some of you will be the one to create some portion of your equity through repairs and renovation.