Foreclosed properties can be a fantastic opportunity for investors and families looking for a new home, but they also come with additional risk. Not only is finding a quality foreclosed home more challenging, but the actual sales process is also more complex without some of the protections you’d normally enjoy under real estate law. Below is an overview of these sales and how an attorney can help protect your interests.

What Are the Differences Between Foreclosures and Traditional Real Estate Sales?

In a traditional real estate sale, you’ll normally be able to negotiate the sales with the seller. You might ask for repairs or other concessions or lower your offer to compensate for repairs the property may need. Foreclosures, on the other hand, are generally sold on an “as is” basis, which means the lender isn’t willing to make repairs before closing. If the property needs foundation work or a new roof, you’ll have to pay for those yourself after the sale. In fact, if you purchase the property at auction, you may not have a chance to inspect the house at all.

Many lenders are also unwilling to negotiate on price. This can be a significant stumbling block if their asking price wouldn’t leave you with enough to repair or upgrade your new home.

When Should You Buy a Foreclosed Property?

Property owners who know that foreclosure is inevitable may decide to sell the property early in the process. As a general rule, buying a home prior to foreclosure is easier, and may not differ much from a traditional sale. However, sellers may not have much money for repairs or upgrades, and the sale does have to be approved by the mortgage lender. If the sales price is less than the current owners owe, they may turn down your offer.

Buying a home after foreclosure is typically much more complex. Not only will you have to work directly with the lender, you may also have to clear liens and other encumbrances on the title.

How Can a Real Estate Law Attorney Help?

Having a real estate attorney do a thorough title search before closing can help you avoid inheriting competing claims, liens, or other encumbrances on the title. Your attorney will also guarantee their work, so you’ll be insured if you discover a defect with the title.

With their legal expertise, your attorney will also review the contracts before signing to ensure they’re in your interest. Discovering an unfair clause in the contract before closing can save you thousands of dollars and a great deal of frustration later.

If you’re thinking of buying a foreclosed property in west-central Missouri, turn to Baker Law Firm LLC. With over 50 years’ of experience in real estate law, you can rely on their legal team to guide you through every step of the process. Visit their website for more on their real estate law services, call (417) 646-8125 to speak with an attorney in Osceola, or dial (660) 885-0202 to reach their Clinton office.