“Buying a foreclosure in Dallas,” can be a great way to make some extra cash… as long as you know what to look for. The process can require you to be much more diligent in your research of the house.
In this article by We Buy Houses Cash Dallas, we will go over things to watch out for when buying a foreclosure so you can make a smart investment decision.
One must remember that there are several stages to a foreclosure process. First, once a substitute Trustee signs off on the Notice of Default documents presented by the lender, the process of foreclosure begins. When buying a foreclosure in Dallas, buyers can seek out the owner(s) of the property in order to help them or purchase the property from the owner(s).
Keep in mind, once a foreclosure property makes it to the court house to be auctioned off, there is no time to perform any due diligence. Any foreclosure property that is not sold at auction then becomes an REO property, again owned by the bank or credit union.
General Wear, Neglect & Vandalism
When a homeowner falls victim to foreclosure, they often fail to properly upkeep the home. When buying a foreclosure in Dallas, you must be ready for all types of damage and neglect to the property. The yard can become badly overgrown, pools improperly maintained and common repairs will go ignored. Everything from a minor leaky faucet, to a major leak in the roof, can affect the condition of the home. And once a homeowner learns that they will be losing their home, they are less likely to sink any money into fixing it.
When homeowners become distressed, for what ever reason, loss of a job, hospitalized or a death in the family, they’re property usually becomes distressed. Normally it takes around six months prior to when a property becomes an active foreclosure. So if you are buying a foreclosure in Dallas, it is very important to do a proper inspection of the property.
Sometimes the banks can stall the sale of the home, leaving the property vacant for months at a time. You can expect major appliances to be removed by either the previous owner or by people who know the house is empty.
Even things such as copper pipes can be removed as there is a cash value for them. Sometimes, an owner who knows they are losing their home will cause damage to the house, either due to anger or in an attempt to retrieve items from the home after the bank has locked them out.
You can expect some broken windows and for items to be ripped from the home haphazardly. Typical vandalism happens to vacant houses across the country, whether it comes from the previous owner or not.
Dealing With Dirt & Items Left Behind
In addition to the lack of routine repairs and maintenance, you can expect things to be dirty. It has become routine when buying a foreclosure in Dallas. It is highly probable the house will not have been cleaned in months. And with the possibility of broken windows, critters, dirt and leaves can find their way in, making a mess of the floors.
Sometimes, if a homeowner leaves quickly, or lacks the space for their belongings, things can be left behind. This includes larger pieces that you will have to move out yourself. When we buy houses, we always inform the owner(s) that they can leave furnishings behind and we will throw it all out. Take what you want scenario.
By the time the house has been vacant for any period of time it becomes the banks responsibility to complete all repairs and make the property property ready for retail sale. Sometimes, if you are looking at buying a foreclosure in Dallas, you can contact the bank or lender and work out a deal to purchase property. There are lists of banks out there that you can buy to find those banks or lenders that will sell they’re REO’s.
No Disclosures
Now, you will be working with the bank or lender to buy this home as opposed to the previous owner. Because of this, you cannot expect the bank to offer you any insight into previous repair work or issues with the home. If you are buying a foreclosure in Dallas, you will be working directly with a real estate broker who represents the bank in question. The bank has never lived there. You will need to have your own home inspection done so can understand the home’s foundation, both literally and figuratively.
The bank is under no obligation to disclose anything about the home. They sell as-is, leaving you to deal with any issues that may arise. When buying a foreclosure in Dallas, from the bank or lender, you are not buying a new gem, you are buying a problem property.
Financing Hurdles
A bank will not give you a loan for a house that appraises lower than what you are paying. They will not see the value in giving you a loan for a property they consider uninhabitable. When buying a foreclosure in Dallas, or any where, know that those foreclosures are paid for in cash, by investors who want to fix and flip the home.
You can expect high competition from cash buyers who are able to work with the banks and quickly pay the amount for the home the bank is requesting.
Many of these investors flip homes for a living and will be able to get the inside track on when a good deal is about to hit the market. Position yourself by thoroughly educating yourself on the property in question, and what is required of you to make an offer.
If you are interested in making an investment in foreclosed properties, click here to visit our website and fill out this form, and a member of our team will get back to you! Or feel free to call our office anytime! (214) 723-1304.
