Searching for cheap homes for sale? If so, you won't have to search very long. Just drive through any neighborhood and you're certain to find numerous 'For Sale' signs. While many homes are listed by realtors, a large percentage of homeowners are now listing their properties on their own. Some sellers even go so far as to offer seller carry back financing to entice buyers who cannot qualify for mortgage loans.
Another good source of cheap homes for sale includes foreclosure homes and bank owned properties. Although distressed properties are usually sold under market value, they could potentially end up being a money pit unless they are purchased for wholesaling purposes.
Wholesaling is a form of house flipping. The primary difference is buyers do not invest any of their own money into the property. While most investors purchase fixer-upper houses to rehab and sell for profit, wholesaling involves finding cheap homes and reselling them to professional rehabbers for profit.
In instances when homeowners are facing foreclosure, their lender may agree to a short sale. If borrowers have equity in their home, their lender may accept less than is owed on the mortgage note. Borrowers must have a qualified buyer in place to obtain short sale approval.
Investors lucky enough to purchase short sale properties generally find them to be a profitable investment. Most mortgage lenders prefer to have their money and avoid the headaches associated with managing distressed properties. If homeowners can locate a buyer for short sale property, chances are the lender will consider the offer.
Foreclosure homes frequently fall into the category of cheap homes for sale. Occasionally great deals can be found at foreclosure auctions. It is important to realize the majority of foreclosed homes require considerable repairs. Some have sat vacant for several years or been subjected to vandalism.
A better option to foreclosed homes is real estate owned (REO) properties. REO houses were once foreclosure homes that didn't sell at auction. Once foreclosure houses are returned to the bank, they no longer have a mortgage. Instead, the bank owns the property and is responsible for maintaining it. Bank owned homes can be found by visiting mortgage lender and realty websites.
Perhaps the best way to locate cheap homes for sale is by searching probate records. When people die everything they own is transferred to probate. Distribution to heirs cannot occur until the decedent's Last Will and Testament is verified and the estate is inventoried.
If things go smoothly, probate can settle in six to eight months. If the decedent did not execute a Will, or if heirs contest the Will, probate can take years to settle. If the decedent owned real estate with a mortgage note, the estate must continue making payments throughout probate. In addition to mortgage payments, the estate must carry insurance, pay property taxes and maintain the property. This can place a heavy financial burden on the estate.
Wills are public record and provide a wealth of information. By taking time to research probate records, investors can locate estates with real estate holdings. Experts recommend seeking out estates valued at $150,000 or more.
Although there are no special requirements for purchasing probate properties, it is exceptionally important to be respectful when contacting estate administrators. Many estate executors are unaware of the fact they can sell probate real estate. By offering them a reasonable purchase price, you can offer a solution to reduce financial burden from the estate while purchasing the property well under market value.
There are numerous real estate bargains available. It is simply a matter of understanding the choices available and developing deals which benefit all parties involved.