“Abandoned house for sale” isn’t a sign you’re likely to see on the roadside (is this method of sale even legal, you might ask?). But abandoned properties that are unclaimed by their owners are potential low-cost purchases that may actually be attractive to prospective home buyers.
An abandoned property is usually a property whose original owner is no longer in possession of the home. Due to the owner’s financial difficulties, the house is run-down and in need of repair. If the law in your area allows you to claim this type of home, it might be worth investigating.
However, some abandoned, unclaimed properties turn out to be in good condition, and the owner may want to unload the property before foreclosure. This could provide the right buyer with an opportunity to purchase the abandoned property or unclaimed home at a discount—and possibly a significant return on investment if you later flip it.
Planning to buy an abandoned or unclaimed property for sale
Purchasing an abandoned or unclaimed property involves following the same procedures as buying any other piece of real estate. Before setting out on your journey to find an abandoned home, review your financial situation.
Remember, there will be additional expenses over and above the original sale price of the property. A pre-qualification from your bank or lender will help you estimate what mortgage amount you qualify for. Many banks also require pre-approval letters, so you can make quick decisions on the property you wish to purchase.
How to find abandoned properties
Most abandoned homes are on their way to foreclosure, but the bank has not yet initiated the process. Various lists of abandoned properties or unclaimed properties are available.
Check the classifieds for homes whose listings contain certain phrases that may indicate an abandoned property, such as “immediate possession,” “must sell,” “below market value,” or “under appraisal.”
Real estate agents have valuable knowledge of abandoned properties in the area and the law relating to claiming them, and can provide you with a selection of homes about to be foreclosed on by the bank.
Some properties may look abandoned, but are not listed for sale. You might also check into the laws regarding unclaimed property and whether there is a statute of limitations on its return.
If you find an interesting unclaimed property like this, visit your county clerk’s office. It will have information about the homeowners, the home’s current appraised value, liens, or tax problems.
You could then try tracking down the owners and asking them to sell their property. If the property has had liens or tax problems, the owners might be more willing to sell.
Placing a bid on property with no owner
Assuming you have found a potential home and been pre-approved, you will want to figure in the costs that will be needed to get the home into good condition. Get a thorough maintenance inspection performed on the property, and note what needs to be fixed and how much it will cost.
Claiming a property like this also involves adding in the cost of the appraisal fee, pest and lead inspection fees, title insurance, closing costs, and other legal fees.
Crunch the numbers before you consider a bid for the owner. A real estate agent can also accompany you to the house and point out the extra expenses you will incur after the purchase of this property. The agent can also help you figure out how high your bid should be. Look for the right opportunities, and you will find the home that is just right for your budget.
Source: realtor.com