The Most Essential Questions to Ask Before Buying a Foreclosure

This includes making sure you: 

• Are out of debt 
• Have a downpayment of at least 10%-20% for a 15 year fixed-rate mortgage
• Have an emergency fund of 3-6 months expenses
• Have enough additional cash saved to cover the cost of any repairs 

If you are looking for a move-in ready home in great shape, then a foreclosure might not be the right option for you because it will take considerable work. However, if you are willing to be patient, look past a little neglect, and if you have enough money to comfortably cover any home repairs, you can sometimes score a great deal. 

Our Calgary Realtors Are in the Best Position to Get You a Great Deal on Your Home 

It can be a huge challenge to buy a home in today’s market, especially if you are a first time home-buyer. However, our team of top Calgary realtors are in the best position to help you get your dream home at a great price! We have 40 years of experience in the industry and strive to go above and beyond your expectations and meet all your specific needs. 

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Top Questions to Ask When Buying a Foreclosed Home in Calgary 

When a homeowner can’t make their mortgage payments, the bank or lender will do their best to recover the money that was loaned. If the issue cannot be settled, then the home may go into foreclosure, which essentially means that the bank or mortgage-holder sells the home, usually at a discounted price. 

While this is a difficult situation for many, foreclosures do provide an opportunity for buyers. By purchasing such a property, you can get a great deal. However, before making any commitment, you must make sure to ask the following questions: 

1. Are There Any Liens On The Home? 

When buying a foreclosed home, you must remember that if a property has a lien, it stays with the home. That means that any liens on the property will be transferred to you as soon as you purchase the home. 

Remember, escaping the lien could be part of the reason that they are selling, so you should never neglect this question. 

2. What Problems Has the Property Had in the Past? 

This is a very general and open-ended question, and while it may lead nowhere, it remains essential to ask. Remember to ask about: 

• Past inspections
• Problems with the fondation 
• Issues with the neighbours 
• The age of the roof, plumbing, wiring, and other features 

This is important to address because if any problems occurred in the past, they could very well happen in the future. 

3. How is the Surrounding Community? 

Before you buy any home, whether it is a foreclosure or not, you must take time to evaluate the neighbourhood. Find out if there are any community/entertainment centres, parks, local schools, or anything else that might be important to you. 

Once you know the neighbourhood, you will be able to make a more informed decision when buying the home and there will be fewer surprises in the future. 

4. Has the Home Already Had an Inspection? 

Apart from any surface-level issues with the home, there might be larger things that you will have to deal with. An inspection will reveal anything you should worry about, but this will come later on in the process. 

Pro Tip: Ask if you can have a copy of an old inspection. This might give you insight into the history of the home and how much you should offer for the home. 

5. How Old is the Home? 

When it comes to foreclosures, the age of the home might not be as important, but it will make a difference if you are planning on selling the home soon. In addition, if the home has been neglected, age could be a sign that you will have some expensive repairs on your hand in the future. 

Considering Buying a Foreclosure? Questions to Ask Yourself First 

Before entering the process of buying a foreclosure, there are certain questions you must ask yourself to ensure that this is the right decision for your and your family. So before embarking on this journey, make sure to ask yourself: 

1. What do you want to do with the property? What is your short and long-term plan for the property? Will you make it your family home, fix it up and sell, or will you rent out the property? Before buying, think about what you will do immediately and in the next 5-10 years. 

2. What is your budget? Before buying a foreclosed home, you must think very hard about your budget. Make sure to consider the full price of the property, not just the monthly payments. This will allow you to organize your future budget properly and ensure there will be no financial hardships in the future. 

3. How much money will you have after the purchase? While you might find a foreclosure in great shape, the majority of them will require repair and remodeling. Make sure to ask yourself how much money you will need to spend to make the home livable, and how much cash will you have on hand after your purchase. 

Our Top Calgary Realtors Are The Best Partners in Finding Your Dream Home 

At Mel Star, our team of top Calgary realtors have sold thousands of foreclosed properties. We understand all the ins and outs of this complex process and we can help you navigate this situation smoothly and successfully, ensuring you get the best price for your dream home. 

To find out more, contact us at (403) 284-6333 or fill in our contact form