Can You Inspect a Foreclosed Home Before Buying?
Waiving the home inspection on the foreclosed home gives sellers one less worry, but costs buyers the chance to uncover pricey problems. Buyers who search for foreclosed homes learn the value of a home inspection quickly. Without it, you cannot get the financing needed to buy the house from most lenders. An inspection also makes it possible for people to buy houses with little to no money down.
It’s always advisable to inspect a home in foreclosure unless it is being sold as-is. You can expect to purchase those homes at bargain prices, usually 20% below market value because of how much work is needed to make them habitable once again.
What to Expect from a Foreclosed Home Inspection?
To find foreclosure homes that are qualified for an inspection, you must work with a buyer agent who will guide you through the process. Here is what you should expect from the home inspection:
- Photographs of the damage inside and outside the residence. Documentation of the home’s problem areas is provided to the buyer to see what they’ll need to do to get the residence up to code and insurable once again. The home inspector provides photographs with their reports for a person’s records. The potential buyer of a foreclosed home can see in detail the issues they may not know about when they did an initial walkthrough of the residence.
- Notice that someone has been squatting in the residence. If there is proof that someone has been occupying the home without permission, the home inspector discusses it with the potential buyer. Knowing that the house is entered by force is imperative because security measures must keep squatters and vandals out. It’s how buyers can protect themselves against unlawful activity inside their newly purchased foreclosure.
- A detailed report on the condition of the property. Everything that the inspector discovers while checking out a house gets compiled into a report provided to the homebuyer. You can then decide whether or not to proceed with the purchase of the foreclosed property.
Who’s Responsible for Inspections on Foreclosed Properties
If you plan to buy a foreclosed property, you can expect to take on the responsibility of paying for inspections. Properties owned by the Department of Housing and Urban Development will always sell as-is. The HUD doesn’t take on the responsibility of performing any inspections.
The Department of Housing and Urban Development allows winning bidders to perform inspections but won’t pay for them. They won’t cancel a winning bid if the buyer finds something wrong. Should the inspection reveal any necessary repairs, you’ll be responsible for those. Each federal agency has a different policy concerning pre-sale inspections.
You cannot preview a tax-foreclosed home before you buy it. On the other hand, HUD homes often sell through approved brokers, making them available to preview before you buy.
