Why are foreclosures so cheap?
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Correspondingly, is it bad to buy a foreclosed house?
You'll find the lowest prices for foreclosed homes by buying them at auction. These properties, often referred to as REO or real-estate owned homes, have already been through the foreclosure process, with banks having taken them over. Banks will often sell these homes at prices below market value to get rid of them.
Beside above, why do foreclosed homes cost less? Foreclosed homes are cheaper because the mortgage holder who foreclosed on the debtor is left holding the bag with the house that was security for the mortgage. So he may be willing to sell the house for less than fair market value to cut his losses quickly by disposing of the house.
Likewise, people ask, how much cheaper is a foreclosed home?
They're usually cheap compared with houses of similar size in the neighborhood. That's what attracts landlords as well as would-be homeowners. Foreclosed property on average goes for prices 37 percent cheaper than similar owner-sold homes in St.
Can you get a foreclosure for less than asking price?
4. Ask About Number of Offers Received for that REO Foreclosure. If there are no offers on the REO home, you can probably offer less than list price and get your offer accepted. However, if there are more than two offers, you will most likely need to offer above the asking price.