Many potential homeowners are starting to look towards Santa Cruz foreclosures as a way to get the home of their dreams without spending their life savings. What they may not realize is that the sheer amount of foreclosed properties can be daunting. Some are so completely overwhelmed by the choices that they give up and walk away.
Santa Cruz foreclosures can be great deals, but you’ll have a few decisions to make before you even go looking. Because there are so many options, here and throughout the nation, it’s important to figure out what type of foreclosed home is best for you.
Government Foreclosures
Homes with federally sponsored loans, such as HUD homes, are repossessed by government housing agencies. Because these homes offer a lot of opportunities for discount purchases, they move quickly.
Foreclosure Auctions
One of the most common ways to buy a foreclosure is while it’s on the chopping block of a traditional real estate auction. The auction is public, with homes sold to the highest bidder.
REO Foreclosures
Repossessed by the bank, real estate owned properties have been through a foreclosure auction without being bought. There’s not necessarily anything wrong with the home itself. In fact, many foreclosure auctions fail to sell the home. The primary reason foreclosure auctions do not succeed is that the auction price is more than what the property is worth. When the auction does fail, ownership reverts to the bank and the home becomes an REO.
REO foreclosures also have auctions, but the bidding process is closed and blind – no haggling allowed. You look over the available properties and come up with an offer to buy the home directly from the bank, rather than competing with other buyers in a public sale.
The good thing with REO foreclosures is that you can also set up the financing and mortgaging options through the same bank. Often, this gives the bank encouragement to give you a better price for the home.
Whether you’re looking at Santa Cruz foreclosures for investment opportunities, or to buy your dream home, you have a myriad of options. Knowing what you want - before you start looking - is one of the best ways to ensure you get the deal of a lifetime!
If you’re unsure which type of foreclosed home is best for you, or if you want help finding a great deal on a foreclosure, I can help. Call me at 831.662.6522 or email me at Lauren@LaurenSpencer.com for more information.
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