It’s sad to lose one’s home due to the inability to pay up the mortgage and that’s when one man’s loss becomes another man’s gain! It’s regrettable but you shouldn’t worry about cashing in on another man’s misery as you are basically helping them out by buying their house.
As many potential home buyers are unable to afford funds to buy a new home, repossessed homes become a viable option for such people. What such people have to keep in mind is that repossessed homes usually enter the market in a distressed state and badly in need of repairs. The owners might even become vindictive and vandalize the property and steal whatever they can including fixtures and fittings; chances are that the gas and electricity bills wouldn’t have been paid or the supplies even cut off!
So here’s a list of things you should do before signing up for a repossessed home:
- Don’t skip getting a builder to survey the property for an estimate of the work needed to be done. And even then, you might not get to know the full extent of the damage and so, have a generous contingency fund in your budget. You will need to calculate how much profit you will be making after bringing the property up to scratch. It may well be that the low cost of the property would come up to current rates after all the repair works, leaving you with no profits!
- Check if there are any restrictions or clauses on the title deed before reaching a decision. Repossessed properties are sold ‘as is’ and the bank doesn’t take any responsibility for any repairs. However, you can demand an electrical, plumbing and gas installation compliance certificate as part of the transfer procedure.
- Investigate if the property is still occupied, whether by the owners or tenants as evicting them and possibly relocating them immediately becomes the buyers’ headache.
- If you feel the property is worth it, move fast and make a reasonable offer; there is no point in making a low offer and face the insecurity of being side-lined. Using the services of an experienced lawyer might make the difference between getting the deal done in a timely manner and not getting fleeced off thousands of pounds in accumulated charges.
So when buying repossessed homes, don’t go in on a whim, but take into cognizance the possibility of repairs and unwarranted bills; go in with your eyes open and you will most probably come out with your mouth open – with a big Cheshire cat grin!