If you’re one of the many interested in buying a home in Northville, you may have considered the potential of purchasing a Northville foreclosure in hopes of saving some money.

It’s not a bad idea when you consider that foreclosures have stayed on the rise in more than 26 metro markets around the nation for the last year – not just in the Metro Detroit area.  If you’re an intrepid first time buyer in Northville trying to find the best deal, a foreclosure could be right up your alley.

The process for buying a foreclosure is just like searching through common real estate in Northville.  If you thought it took time to find a dream home in the regular market, it takes even longer to find the right home to buy in Northville when you’re dealing in foreclosures.

First off – skip the auction.  Foreclosure auctions for Northville real estate and other areas around Metro Detroit can pull even a seasoned real estate investor into a bad deal.  You can’t inspect the home or check the lien status, so buying a Northville foreclosure could open a Pandora’s Box of maintenance, expense and debt beyond your initial calculation.

Dealing with the current tenants

I’ve mentioned this before in previous talks on foreclosures because it’s an important piece of info.  If you buy a home in Northville through an auction and the previous owner still lives in the home then you’ll be forced to evict them.  It also leaves you open for vandalism (if they haven’t damaged the property already.)

Stick to Bank Owned Real Estate in Northville

If you really want to buy a home in Northville that’s been foreclosed, deal with the banks.  In these cases, the bank is required to pay off any senior liens such as back taxes.  They also handle evicting the previous owner.

Most importantly, the home is open to inspection so you can decide if it’s a good investment.

Know our buying options when interested in a foreclosure

Before you try to buy a home in Northville you’ll want to get pre-approved for your mortgage.  After talking to a Michigan mortgage lender and establishing the amount you can spend on a home, you don’t have to go straight to an agent – you have other options.

After a home is foreclosed in Northville, but before it gets listed for sale, you can talk directly with the lender.  They may be eager to wash their hands of the property.  This is especially true if you’re dealing with a local community bank or credit union with a small infrastructure.

Expect to get a smaller appraisal and approval from the lender

Even if you’re approved for a larger amount, the money you borrow is typically in line with the value of the home.  Homes for sale in Northville that have gone through foreclosure tend to appraise for less due to neglect and even vandalism.  Getting a foreclosure with an FHA loan makes for even stricter lending requirements.

Lastly, expect to have to spend extra on maintenance compared to buying other real estate in Northville.  The homes are sold as-is so negotiations on repairs, especially with a bank, are typically non-existent.  That means you foot the bill on those repairs.  Don’t expect room for negotiation on price due to damage either since banks are typically already taking a loss on the foreclosure.

If you’re in the market to buy a home in Northville or the surrounding communities of the Metro Detroit area, give us a call.  A Michigan mortgage lender can help you get pre-approved so you’re in the best position to negotiate for that dream home.