Three Myths about Foreclosed Homes

Experienced in buying and selling both residential and commercial properties, Sergio Garcia serves as sales manager of Chicago Real Estate Leaders. Sergio Garcia brings more than two decades of real estate experience to the role, which involves selling foreclosed homes throughout the nation.

The term foreclosure is subject to many misconceptions. The following are a few myths about foreclosures and what homebuyers should actually expect.

1. Buying a foreclosed home can offer massive discounts upwards of 50 percent. While discounts can be expected, a person should realistically anticipate the discount to be less than 25 percent because the reduction is based on the current market value of a home and comparable properties in the area.

2. A foreclosed property requires a lot of work and money. Bank-owned homes will have flaws, large and small, but many are cosmetic and inexpensive to repair. Likewise, the imperfections are often ones homeowners typically look to customize anyway, such as paint and carpet.

3. Inspections are not allowed when purchasing a foreclosed home. On the contrary, nearly all bank-owned homes are sold as-is. To reduce future liabilities, a bank is likely to encourage a buyer to complete a home inspection, so he or she is fully informed about a home prior to completing the transaction.