Foreclosed homes in Washington D.C.

Foreclosure is a legal process in which a lender attempts to recover the balance of a loan from a borrower who happened to have stopped making payments to the lender by forcing the sale of the asset used as the collateral for the loan. 

Foreclosed homes in DC

Formally, a mortgagee, or other lien-holder, obtains a termination of a mortgagor's equitable right of redemption, either by court order or by procedural operation of law. A mortgagee may sue on a note without foreclosing, obtain a general judgment, and collect that judgment against other property of the mortgagor, without foreclosing. When all other avenues have failed a lender may seek a judgement of foreclosure. Mortgages are formally foreclosed at auction by a licensed auction specialist.

If you are house hunting, you may want to consider buying a foreclosed home, also called a real estate owned (REO) property. The two common ways of buying a foreclosed home are through a real estate agent or through a public auction. Negotiating the purchase price of a foreclosed home may take a little longer than a typical real estate transaction because the process may require multiple levels of approval. the bank will have to approve the offer, and in some cases, an investor may own the property and will have to provide approval as well.

Despite many challenges, auctions can be a good resource, as long as the excitement of bidding does not lead you to buying a foreclosed home at an inflated price or more than you can comfortably afford. It is always a good idea to do your research and set your budget before you attend an auction. Otherwise you may choose to work with a real estate agent experienced with foreclosed properties to guide you through any additional paperwork that may come with buying a foreclosed home and can help you determine if the price is a good value.

Pricing for a foreclosed home is typically set at market value in an effort to move the property quickly. You will want to submit a fair and reasonable offer, as most banks will list properties at a fair price. Distress Sales resulting from bank foreclosures often represent a great way to get a fantastic deal on a home. It's not easy for the average home buyer to find these deals, because you have to keep searching to see when one comes up. So be alarmed or you might miss the finest deal!

If you are looking for foreclosed homes in Washington D.C. area, there are great opportunities to be found within the Bank of America Real Estate Center. Whether you are an experienced home buyer, an investor or a first-time home buyer, they put foreclosure information at your fingertips to help you be confident about choosing a property that’s right for your situation. Take a look at listings for foreclosed homes in D.C. and then work with an experienced real estate agent to visit properties that interest you. The impact of foreclosure goes beyond just homeowners but also expands to towns and neighborhoods as a whole.

Before you start looking at foreclosed homes, you will need to determine how much can you comfortably afford. You will want to make sure the costs for your mortgage, property taxes and insurance are typically no more than 36% of your income before taxes and other deductions. 

Getting a home inspection is always a good idea, but it is particularly important when buying a foreclosed home. This will help you determine the condition of the home, estimated cost of repair, a fair and reasonable offer and most importantly funding the purchase. If you find that repairs are needed for your REO purchase, you may want to consider an FHA 203(k) Renovation Loan. An FHA 203(k) Renovation Loan is a mortgage that can cover the purchase price plus funds for renovation by financing the “as improved” value of the home.

A title search is especially important when buying an REO property due to the unique transfer of ownership at foreclosure. There may be liens on the title that may not be uncovered until the closing process begins. However, a real estate professional who is experienced in foreclosed homes can be a valuable resource in guiding you through this process.

If you decide to move forward with a REO purchase, getting prequalified gives you the advantage of being better prepared to make an offer. Getting prequalified is a process in which a prospective borrower provides financial and other information, such as employment history and funds for a down payment, in order for a lender to determine how much loan the borrower may obtain for the purchase of a home. In addition, a prequalified status shows that you are not just browsing, which in turn makes you more attractive to a seller. Bank of America has loan products that can help with the purchase of an REO property. Beginning the prequalification process is easy and you can get started at the Bank of America Home Loans website.

You can consider Bank of America as a source for REO properties when you are looking to take advantage of today’s affordable housing. Search for homes on the Bank of America Real Estate Center to access Bank of America foreclosure listings and information.

You are your best adviser. Only you can decide if buying a foreclosed home is a good investment for your current situation. Weigh the pros and cons, do your research and work with qualified professionals to help you make the decision that’s right for you.