Versión en EspañolA word of caution right in the beginning. Repossessed houses may not be the same as the houses which have come under the hammer because of the subprime rate crisis. This is said because some people might have doubts and hesitation since they do not understand it. It may be because of that, but mostly it is because that house which has been repossessed might be because of other failures, for which the repossessed house formed collateral security. And there are a wide range of facilities, which require collateral.
To clear your doubts on this score, because it weighs on your conscience, it would be better for you to check why and how that house came on the block, through your real estate agent, or through the signboard posted outside that repossessed house. Ring that number and they will tell you. Normally, if it is a bank, then the Bank would have identified itself on the notice board. Or you can ask a neighbor politely.
Mostly these houses that are repossessed come under the auction route, when the collateral holder wishes to liquidate it quickly, and for a good price, if not just covering his cost.
There are today a large number of them in the market. Near your own suburb, or a closer suburb to your workplace, or even in a beautiful location that you always admired, or the neighborhood was such that you wanted to be there.
There is no harm in trying to get that repossessed house. If it is possessed by the collateral holder, you are spared the embarrassment of facing the owner of the house, and consequently, have an easier conscience.
But before doing so, you must follow certain rules that are recommended. First and foremost, you must engage a real estate agent, and appoint your own architect. This is sound advice, because you must see the house, not only from the outside, but also the complete interiors, as a place, which you are going to move into.
Walk through it and take your time. Look around the house, and see how friendly people are, the lawns, the streets and the bye-lanes.
Once you are somewhat satisfied, get the architect to look up its structural stability, and what further modifications you may want, and whether that repossessed house can bear that additional load. Or, whether you need to pull down a part, and rebuilt according to your dream. Remember, all these cost money. The real estate agent should be able to give you the history of the building, which must be extracted from the country or town planning office, and that all documents pertaining to the repossessed house are showing clear title, and no ifs and buts. Once you have these in hand, you need to sit down and work out how much you can afford to fork out for that repossessed house.
In doing your homework, bear in mind that your own financial stability does not get derailed. Often spur of the moment decisions on repossessed houses leave you in agony later. So be circumspect with emotions, and the head should rule the heart.
Mostly, there would be a reserve price, and if you think that you can’t work on that, just walk away. Don’t jeopardize your finances at this juncture, because the uncertainties in the economy still persist. There is talk of rise in unemployment, stock holdings, which made many people “paper” millionaires, return with a thump back on earth. And pink slips are being common. Or a certain cut in salary income.
