In recent years, lenders may have allowed a grace period for homeowners struggling with delinquent mortgage payments. However, that safety net has apparently been removed, considering that foreclosure filings in Massachusetts have increased by 91 percent from October 2013. In fact, foreclosures have been on the rise for eight consecutive months in the state.
A real estate attorney knows that foreclosure filings can also present a potential purchase opportunity for home hunters. In fact, some investors specialize in buying distressed properties, fixing them up and then selling them at a profit. However, the disclosure rules in a foreclosure proceeding are different than the ordinary real estate transaction. That can lead to a nasty surprise when hidden defects come to light.
For some buyers, however, performing months of renovation may still be a better investment than buying a property at market value. There may also be special loan packages available for such buyers, with money specifically provided for the purpose of renovations.
Another alternative might be short sales. In that type of transaction, a homeowner sells his or her property, usually for less than the mortgage, in order to avoid foreclosure. In that type of transaction, a seller may be persuaded by a buyer that is able to pay cash, rather than waiting for lending arrangements to be approved.
In both cases, a prospective buyer or a distressed seller could benefit from a consultation with a real estate attorney. Even for transactions below market price, there are strategies for maximizing return. An attorney that focuses on real estate acquisitions can explain these tactics in greater detail.
Source: Boston.com, “Competition is High For Boston-area Foreclosures,” Scott Van Voorhis, Dec. 11, 2014