| By :
Stephen Daniels
It is tempting, in a low-interest and shaky economic environment with declining home values, to leap into buying a foreclosed home. Everyone likes a bargain, and this is never truer than when purchasing high-dollar items, such as property. Because property is a high-dollar investment, it is wise to do some considerable research before signing on the dotted line. Some things to look for before taking that leap include: * Is the property bank-owned or ready to go to auction? A bank may impose a variety of rules, but might also offer breaks on closing costs or interest rates; properties purchased at auction are "as is" - no prior inspection is available in most cases. * Are there outstanding liens against the property? * Is the asking price comparable to recent sales in the surrounding neighborhood? * Is the neighborhood in a declining value area? * Is the home considered "safe and habitable" according to conventional or government lending standards? If not, you will have limited financing options. Buyers willing and able to search public records or read industry newsletters may be able to perform all the due diligence required to answer these questions. However, a local real estate agent can help a prospective buyer know what pitfalls to look for, as well as the ins and outs of doing the required research. In addition, they know the local market, which is a huge plus in determining fair value. They have established relationships with lenders and are often better positioned to negotiate on your behalf. Some offices will have staffs that are in place to help you research titles, liens and back taxes. Unlike in a "normal" real estate transaction, when sellers are required to disclose any problems with the home and inspectors come along to make sure every deficiency is brought to light, buying a foreclosed property can leave you holding the bag. Resort areas are often a great place to look for a bargain in a depressed economy. In general, an unusually high percentage of the property is either a second home or an investment for rental, and when times get tough, this is the first type of property that will be forfeited by property owners and investors - especially if values are dropping. Carmel, California, a well-known resort area often associated with celebrities, is perceived as a bastion of the affluent, and this is largely true. However, it is still a resort area with many of the pitfalls that afflict such areas. High-end homeowners are not immune to an economic downturn. In an area such as Carmel, potential buyers should be aware that there are bargains to be had relative to valuations of just a few years ago. However, don't expect to pick up property for pennies on the dollar. These homes are in a very desirable location, so the expression "caveat emptor," or "buyer beware," especially applies here. Buying foreclosed properties in Carmel is no more a slam dunk proposition than it is in other areas. The expert guidance of a knowledgeable real estate agent can help purchasers with researching tax liens, negotiating with banks or discovering the buried treasure of construction loan defaults. These opportunities are called hidden foreclosures, because they are not listed in public records as foreclosures. Working with a professional broker is just as important for your financial health as consulting a doctor for your physical health. If you're looking for Carmel homes for sale, it's a good idea to look for a reputable Carmel real estate agent at the same time.
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