Online tools allow you to evaluate potential purchases from the comfort
of your home There are two words that give pause to the most motivated
real estate buyer or investor, especially during the busy holiday season:
In the past, property research equated to extensive legwork - often involving a trek down to the local recorder's office - and expense that was spent evaluating a property's market value and all the debt encumbering the property. But now a few clicks of the mouse will get you that same information for properties nationwide. This information include:
Comparable Sales: provides up to 15 recently sold properties in the neighborhood so you can pinpoint the property's true market value.
Lien & Loan History: provides a list of all liens and loans (mortgages and trust deeds) against the property so you can calculate the total debt encumbering the property.
Thorough research has always been crucial to determining a property's investment potential. But the tools and resources needed to do that research are much more accessible now than ever before.
Many online sites can help investors and homebuyers tap into the previously hidden foreclosure market by providing access to property data formerly available only to professional real estate brokers and investors. Today, homebuyers can use these services to identify and research potential home purchases, as well as to find the tools and professional resources they need to help them close the deal.
It makes sense to give any property under consideration - foreclosure or
otherwise - an in-depth examination. First, check the Lien & Loan
History for all debts secured by the property. Subtract the total amount
owed from the estimated market value, based on the Comparable Sales, to
determine the potential bargain. After making contact with the owner or real
estate agent, arrange a walk-through of the property to evaluate its
condition. Factor estimated repair costs into your purchase offer. Before
you close the deal, hire a professional home inspector to inspect the
property and enlist a title company to run a final title check.
If you purchase a property at a public foreclosure auction, you won't have a chance to inspect a property before buying, which makes this type of purchase more risky. But if you've researched the title and determined the amount owed is far less than the market value, you'll have some margin to cover unexpected repair costs. Before you go to the auction, set a maximum bid based on your research and stick to that bid at the auction.
Although you'll be able to inspect the property if it's bank-owned, the bank typically knows little about the property and will sell it in "as-is" condition. This means the bank will disclose all the needed repairs it knows about, but is not held responsible after the sale for any repairs it did not know about. Factor the known repairs into your purchase offer and have a professional inspection conducted before closing the deal. You should also have a title company run a final title check before closing, although most banks will make sure the title is clear before selling.
No matter what type of property you’re planning to buy, good property research will help you recognize which properties represent smart investments and which do not. And that research is now much more convenient thanks to the extensive property research tools available online. Remember, a little preparation before the sale