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Can I Get A Foreclosure Mortgage?

If you’re interested in buying foreclosed real estate there are mortgages out there for you. In fact, a possible source of a foreclosure mortgage is the very lender selling the foreclosed property.

In terms of financing, real estate is real estate. The fact that it’s a foreclosure, distressed property or home for sale under normal conditions makes no difference. The important point is that the economic sins of the last owner do not transfer to the new one. What matters is that at the time of financing the property has good, marketable and insurable title and that it also has a given market value.

Once the value of a foreclosed property has been determined through a sale agreement or appraisal, whichever is less, the real estate can then be financed in the same way as any other property.


There is, however, one difference with foreclosed properties which should be of interest to would-be buyers: In some cases lenders will finance the sale of the properties they’re selling.

Leverage

This is both good news and not-so-good news. The good news is that the lender is one more source of financing in addition to all the other mortgage sources that are out there. The not-so-good news is that the willingness of the lender to finance the sale may bring in other bidders and it may stiffen the lender’s negotiation stance.

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Posted in: Foreclosures

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