The excellent news is that foreclosure properties are a completely legal and legitimate way to buy real estate. In fact, some of the most successful investors in the world regularly invest in foreclosed properties, because they know that these properties are an amazing purchase and an outstanding value. Many millionaires have made their fortunes with foreclosure real estate. Even average people have saved substantially on a home purchase by buying foreclosures.
Foreclosure is a legal process which protects lenders from defaulted loans. If a homeowner purchases a home and uses a home loan or mortgage to pay for that home, the homeowner has an obligation to repay the loan - usually with monthly payments. If the homeowner does not pay his or her mortgage, he or she is considered in default. To earn back the money that is not being paid through mortgage payments, the lender starts the foreclosure process. This is a process which allows the lender to take ownership of the property. Once the lender has the property, he or she will generally sell it so that the money owed on the loan is paid back in full. If a mortgage is insured by the government, the government pays the lender the money owing on the loan and the property is owned by the government. The government tries to sell the property to earn back the money they have paid out to the lender.
Foreclosure is therefore a perfectly legal process and foreclosed homes are a legitimate way to buy real estate. In fact, foreclosed houses can be a very ethical and responsible way to buy property. Many distressed properties need a little work and by cleaning up and making some minor repairs to that property, you raise its value and you make it an appealing property again. This can actually decrease the need for new housing units, which is great news for the environment. Fixing an existing home is a much more ecological solution than building a new property. Plus, when you fix a foreclosed house you improve the neighborhood where the property is located. The property values of homes near the property also increase. Buying foreclosures is a responsible thing to do.
In fact, foreclosure homes can be an outstanding way to buy property. There are almost too many advantages to list. Foreclosure homes offer you instant savings and instant equity, which can help you secure a lower interest rate on future loans. Buying a government foreclosure may qualify you for special programs that can help you save more money. In addition, there are so many foreclosures to choose from that you can buy your dream house. There are hundreds of thousands of distressed properties across the nation. Whether you want a condo, a history property, a commercial property or just a single family homes, you can find what you need with foreclosure homes. Foreclosed houses are also available in virtually every neighborhood, so you can be part of that community you have always wanted to join.
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