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THE HEARTBREAK OF FORECLOSURES (FOR BUYERS)

Right now about 50% of all transactions in the U.S. real estate market are foreclosure properties.
Unfortunately, many buyers are woefully ill-informed as to the process of foreclosure and only think it means they can get the house cheap. Not usually the case!

Most foreclosures are on a bid system. That is, it is similar to an auction in that many buyers submit offers with fool proof of funds, and complying to all of the lender's requirements. On a specified day and time, the bids are opened and the highest qualified bid gets the property.

Because of the huge competitive nature of this process right now, many properties are getting in excess of 20 or 30 offers (usually first time homebuyers competing with investors) which results in the prices are always significantly higher than the published foreclosure price. This means that many people who think they can afford the property may not be able to, AND in most cases you have to bid on quite a few properties in order to get one.

Far too often I hear people who are "only interested in THAT property". Ultimately this leads to great frustration, stress and disappointment as the chances of submitting the winning bid are pretty small unless there is a significant overbid submitted.

One client I spoke with recently has submitted 8 offers since January and still does not have a property. Another has been trying for a year and no purchase yet.

Be prepared for a frustrating, disheartening and difficult experience when dealing with foreclosures, and don;t get your hopes up about a particluar home....there are always others available that may even be a better home for you. Work with a buyer's agent who can help you identify them, and if you catch them BEFORE they go into foreclosure, you may end up with a much better transaction.