What You Need to Know About Buying a Foreclosure in Lansing

What Buyers Need to Know About the Lansing Real Estate Market

With sales and prices improving and the market turning in favor of sellers, Lansing home buyers need to be strategic and a bit creative when looking for a home. Lansing is currently one of the most popular cities for real estate, according to the National Association of Realtors, ranking #20 on a list of 200 cities nationwide. As a result, buyers should expect reasonable competition for affordably priced homes and many find themselves considering alternatives such as foreclosures and fixer-uppers. If this is you, here's what you need to know when buying a foreclosure in the Lansing area.

The Four Types of Foreclosures

• Pre-foreclosures (short sale)
• Auction
• Real Estate Owned (REO)
• Government-owned

All of these are considered distressed properties because of the financial situation of the owners and also because of their physical condition.

Basics of Buying a Foreclosure

The two most common ways of buying a foreclosed home are through a real estate agent or by auction. Before you even begin house hunting however, it is highly recommended that you find a real estate broker and get a pre-approval from a lender.

1. If you need help, ask for it

When looking for a real estate broker ideally you want someone who works directly with banks that own foreclosed homes. In choosing to work with a real estate professional with experience in foreclosures, you gain better access to available foreclosure listings and an aid in navigating the buying process, as it differs from conventional real estate sales.

2. Work out financing first

It's not uncommon to find that a foreclosure has been sitting vacant for some time or that the previous occupants didn't care for the home and property as you may have hoped, creating a long list of fixes or repairs that need to be done in order to get the home up to date and comfortable to live in. Consider these repairs and out-of-pocket expenses, and set a max price, so you do not get carried away.

3. Conduct a title search

This is an important step in the home buying process when it comes to foreclosures. Performing a title search allows you to check for any outstanding debts someone may be attempting to collect against the property, and also allows you to verify that the deed is correct.

4. Complete home inspection

Buyers looking to purchase foreclosures are often allowed and strongly encouraged, to complete professional home inspections on the property in consideration. Doing so helps to determine the condition of the home, estimated cost of repairs, and develop a fair and reasonable offer.

5. Coordinate closing

Coordinating the closing date with your agent is how you will determine the date on which you will take possession of the property. This allows for time to address and resolve any title issues and complete all necessary paperwork. It is also necessary to allow for sufficient time after the scheduled contract closes before scheduling movers, furniture delivery, setting up utilities, etc.

For some, purchasing a foreclosure may be too much of a risk and financial burden, but for others, it might be the perfect opportunity to transform a home into the perfect place for their family and situation. It important to consider each of these elements and consult with an experience Realtor to make sure you have all your bases covered before you take the leap into foreclosure homeownership.