How to Buy Real Estate at Bargain Prices

As with everything else in the economy, real estate adheres to the principles of supply and demand. When there is a low demand on homes, the prices will be less then when there is a higher demand. Foreclosures, short sales and auctions are all good sources of discount real estate, no matter how the economy fares–although when the economy is down, there will be more homes in foreclosure.

Foreclosures

• Research you local newspapers for foreclosure notices. When a home is in foreclosure, the bank must announce it in the paper three times. After the third time, chances are the home will be auctioned off to the highest bidder at a foreclosure auction. During this period the debtor is scrambling to find the money to pay for his debt. This is a good time to acquire the property for less than the market value or approach the owner with a short sale. Foreclosure notices are usually at the end of a newspaper’s business section or in a business journal, and are titled "Notice of Foreclosure." Here it will state the debtor, the bank, the amount owed, the address of the property and the date of the auction.
• Contact the owner through the mail, a phone call, or simply knock on the door. Ask if he’d be willing to sell the home. More than likely, there is already a for sale sign in the front yard. At this point the owner is resigned to the fact that he won’t make a profit on the house. Many just want out of their bank note without a foreclosure on their credit record. If the home is listed with a Realtor, contact him for a walk-through of the home.
• Assess the repairs needed on the home, if any, before you make an offer. It is wise to walk through the home with an inspector if possible. The home inspector will enable you to correctly determine what is needed in the home. Make an offer on the home through your Realtor.

Short Sales

• Research the Notice of Foreclosure section in the newspaper or business journal. A short sale on a home is best offered when the home is in the foreclosure process. With a short sale, the home is sold for less than the bank note is worth–rendering it short. Many banks will agree to this because it costs them money and time to proceed with the foreclosure proceedings on the home.
• Contact the debtors listed in the paper, as above, and ask either them or their Realtors if they would consider a short sale. The bank must be in agreement since it is the holder of the note.
• Submit an offer to the bank that your Realtor has drawn up.

Auctions

• Research the Notice of Foreclosure section in the newspaper and look for the third notice, which means the debtors have not come current with their debt. Note the day, time and place of the auction.
• Attend the auction and be ready to bid. It is wise to have a limit on how high you will bid for a property. Many foreclosure properties are in need of repair, which can be costly. Be sure to drive by the properties and research them before you bid. A Realtor is not needed to bid.
• If no one bids higher than you, be ready to buy the house. You have 24 hours to come through with the money or financing. If you fail, you will not get the property and it will be offered to the next highest bidder.

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Stop by some of the best real estate markets like the Aurora real estate, Golden real estate, Lafayette Colorado real estate and the Lakewood real estate markets when looking to buy a home in the State of Colorado.