Although finding property at a discount may seem tempting, it is wise to proceed with caution before signing papers and making a short sale transaction. Learning about a home that is in foreclosure or short sale could very well lead to a profitable purchase, there are several things that you should consider doing before making your purchase.
Do not ignore problems with the property. What you suspect might be a minor termite invasion could turn out to be a far worse problem. Other common issues with homes that may have been neglected include mold or damage from squatters or angry previous owners who intentionally damage the home. The easiest way to avoid potential problems down the road is to have a full home inspection done.
It is also important to be aware of all legal and insurance information. Failing to follow the laws or ignoring insurance information could lead to costly issues down the line such as citations and fines or even denial of insurance.
Before making a decision about buying a new home, take a step back and consider all possible potential issues or problems. This would include possible and necessary renovations as well mortgage payments, and the real estate market in general.
As with any real estate transaction, the laws can be tricky and if you do not have a complete understanding, you may find yourself scrambling to fix errors or oversights that could have been avoided. During these times, it is not uncommon for someone to speak with a firm familiar with real estate to make certain that all your i's are dotted and your t's a crossed to assure a smooth and pain-free transaction.
Source: Bankrate, "5 common errors when buying a short-sale house," Lora Shinn, June 12, 2017