Thursday, April 7, 2016 - Article by: MEL SMITH--LENDER OF THE MONTH - Meadowbrook Financial Mortgage Bankers -
Are you considering purchasing a foreclosed home?Local communities benefit when foreclosed homes are sold and occupied.Here are some things to be aware of if you chose to do so.Myth:Foreclosed properties can only be acquired with cash.Reality:On average, approximately 60% of foreclosed homes purchased are financed.
If you're considering the purchase of a foreclosure property, you may want to gauge whether you should purchase the property out-and-out with your cash reserves, or whether you should finance the purchase.
Procuring your foreclosed property with cash means:1.You'll have no monthly loan payments, no interest expense or closing cost expense2.You may be able to close faster3.You could have a superior negotiating position4.You could be able to apply for financing at a later date
Attaining home loan financing for a foreclosed property means:1.Financing could permit you to maintain access to your cash reserves for investments, emergencies, and other purposes.2.You may have more purchasing power than with cash only.3.You might collect tax benefits, including the potential to deduct your interest payments. 4.The lender typically orders services such as appraisals and inspections. If you're purchasing a home with cash, you'll be responsible for obtaining these services.
Ensure that you review what options are available to you when contemplate this type of purchase.
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