What are some pro's and con's of purchasing an foreclosed home?

Question

What are some pro's and con's of purchasing an foreclosed home?

Answer 1

Pros:

- You can usually get one below the appraised value of model matches in the area

- The banks want to get them off the books ASAP, so you're guaranteed a quick escrow

Cons:

- The bank does not have to submit a transfer disclosure statement (TDS). So, it's up to you to determine what the condition of the home is.

- Since there is no TDS and foreclosures are sold as-is, the buyer has no recourse if he finds something wrong with the house after the sale is complete.

- You never know why someone let the house go into foreclosure. It may have been beyone economical repair and, in order to make it livable, it becomes a money pit for the buyer.

- Prior to being evicted, people are upset and sometimes try to take it out on the bank by trashing the place or stripping literally everything out of it. So, a place that looks like a great deal on paper might require more work to bring up to livable standards than if you were to buy a non-foreclosure that's been fixed up.