Dispelling 3 Foreclosure Myths

There’s a lot of conflicting information out there regarding purchasing foreclosure homes. Whether or not you’ve heard horror stories or only positive things depends largely on the experience of the person telling you their story. Here we’ll cover some of the most common myths about foreclosures and give you the real scoop on buying this type of property.

Myth #1: Foreclosed homes are ALWAYS a bargain

Truth: Lenders are trying to maximize the returns on foreclosed homes. These days, those same lenders are starting to offer even larger discounts to buyers to get the property off the books. You will find, though, that many foreclosed homes need some serious repairs. Compare your budget to the amount it will take to fix up a property and you’ll see it may not be a bargain after all.

Myth #2: Buying a foreclosed home is risky
Truth: In any real estate deal, risks are inevitable. Yes, foreclosed homes sold at auctions come with their risks. Even the risk that you will take on the former owner’s liens and loans alike. However, most buyers are looking for foreclosed homes that the bank owns. These homes are listed like any other ‘normal’ home. Realistically, foreclosure homes are no riskier than any other non-foreclosure homes.

Myth #3: Foreclosures are more likely to lose their house market value than the typical investment property
Truth:
Actually, since foreclosed homes are often discounted from the home’s current market assessment, there is some degree of protection from further depreciation. Loss of house market value depends on the local real estate market dynamic. It is NOT dependent on whether or not it was a foreclosure at the time of purchase.

Ready to start checking out foreclosure properties in the Denver area? An experienced pro can help you better navigate the waters. Contact Metrowest today – we specialize in these types of sales and would love to help you start the process!

Ken Blevins

About Ken Blevins

Ken Blevins, CEO of Metrowest Real Estate Services, is a veteran in mortgage and default servicing with more than 24 years of experience in collections, foreclosure/bankruptcy, loss mitigation and real estate disposition (REO). Blevins was an original co-founder of Metrowest in 2003, a Real Estate Brokerage and Services Company focused on the resale, recovery and liquidation of distressed real estate in Denver, Colorado and surrounding metros. Blevins assumed the role of CEO in January 2014 and provides strategic direction and has management accountability for the day-to-day operations. Under his direction, Blevins drives all default management operations to maximize asset value recovery and reduce loss severity through a strategy focused on customer service and state of the art technology. Blevins has 18 years of direct operational experience in all facets of REO Asset Management having managed large national REO Disposition contracts for Fannie Mae, Freddie Mac, Wells Fargo, JP Morgan Chase, CitiFinancial, GMAC Mortgage and other various financial institutions. Blevins specialties include REO asset management, real estate investment, bulk REO acquisitions and distressed asset recovery and liquidation, and he has directed the resolution and liquidation of over ten billion in institutionally-owned residential real estate.

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