Foreclosure Opportunities - Buyer Beware

Posted at 3:43 AM, Feb. 24, 2007

Many investors and would be-investors are reading with great interest the recent news reports and articles concerning the looming foreclosure crisis in the U.S.  It's true that a certain group of homeowners are now facing potential foreclosure due to the impending rate changes associated with very low introductory interest rates and adjustable rate mortgages.

While foreclosure properties can be a very lucrative investment, they also can pose some problems that the prospective purchaser will not know about until AFTER they've made the purchase.

When homeowners default on the mortgage, the majority have also allowed basic home maintenance and repairs slide because they've been doing everything they can to save their home and spending money on maintenance is not high on their priority list.  There is also the possibility of hidden debt.  Not surprisingly, some of these homeowners have refinanced, taken 2nd and 3rd mortgages, or have mechanic's liens or tax liens on the property.  As with maintenance and general property condition issues, the prospective purchaser will not know until it's too late.

TOMORROW:  Performing Due Diligence in Buying Foreclosure Properties