I just read a really good article which was on the National Association of Realtors' website. 5 Tips for Buying a Foreclosure was the title and I will just give you a short overview.
Having listed a few foreclosure properties myself and having looked over the advice in the article, I think these tips are legitimate and very helpful.
When lenders take over a home, they want to sell it as quickly as possible. Since lenders aren't in the real estate business, they turn to real estate broker for help marketing their properties. Buying a foreclosed home can be a bargain, but the process can be problematic.
The first tip is to work with a Realtor who has foreclosure experience.
2. Be ready for complications. Ask your Realtor to recommend a real estate attorney who will explain your state's foreclosure process. Be patient.
3. Work with your agent to set a price. Ask your agent to show you closed sales of comparable homes. These sales will show you what the market value of the foreclosed home is. Start with an offer well under the market value to see if the lender may be in a hurry to get rid of the house.
Good deals on Foreclosed Properties
4. Get your financing in order. Many Lenders require buyers to submit a financing preapproval letter with the purchase agreement. They often reject all contingencies. The good news is that most foreclosures can close quickly.
5. Expect an as-is sale. Be sure to have enough money left after the sale to make repairs. Most lenders may give you credit for some minor repairs, but will not help with major problems with the foreclosure>
Don't be caught by surprise and make sure that you have money to make the home livable after closing.
I hope these tips on buying a foreclosed property have been helpful to you. It is a great time to buy with low mortgage rates and many great deals on foreclosed properties. Have fun, be patient, and make a great deal.