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So, You want to Buy a Foreclosure?


Blog by Claire LeLacheur | October 5th, 2010


 

When you purchase a court ordered sale or a foreclosure, you, as the Buyer are purchasing the property in an as is where is condition.

What does this mean you might ask?

Sally Seller owns a house and has not made any mortgage payments for the past three consecutive months. Sally's bank forecloses on her and technically she is no longer the owner, the bank is.

Since the owner is the bank and they have never lived on the property they cannot guarantee that the property will be in the same condition as when Bobby Buyer looked at it. Bobby will have to accept the fact that there may be no fridge, stove washer, dryer, microwave, window coverings or alarm system when he takes possession.

Furthermore, Sally may possibly be in a financial position that may not allow her to take all of her belongings with her, so she may leave them for Bobby to dispose of, including furniture. Or it could be the other way around; Sally might be so upset at the bank for foreclosing on her that she may take everything including the kitchen sink, the kitchen cupboards and the counter tops.

Once Bobby takes possession of his new property he will have to accept the property as is where is. If that means that he is accepting a property that has not been cleaned for the past year, the stove has mysteriously gone missing and there are no curtains and Sally has left her cat behind, then that is the way it is. Bobby has limited recourse and must contend with the situation.

Most Buyers think that purchasing a foreclosure or court ordered sale is going to be a great deal, that they will get a property for cheap, and in many cases there are deals to be had, but you must be prepared for the consequences of a "deal". Usually there is no easy way to get a "deal" when it comes to Real Estate.  

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