While Merced County had some of the highest foreclosure rates in the country in the housing market crisis of 2007 to 2010,* the housing market here has fully recovered since that time. However, if you’re looking for a bargain, you can still find hundreds of Merced County homes either in pre-foreclosure or that are already foreclosed.
Buying any home or property can be a stressful process, but deciding to buy a foreclosed home can make the process even more challenging. So much so that people often wonder whether it’s worth it. So what exactly are the pros and cons of buying a foreclosed home in Merced County?
Why Buy a Foreclosed Property?
The main benefit of buying a foreclosed home in Merced County is that it’s usually much cheaper than similar properties in the area. This is because the property owners are generally in the pre-foreclosure or the short-sale stage. For those who are in this predicament, time is not on their side. Therefore, their leverage in negotiations isn’t as high. This may seem insensitive, but for a buyer, there is an advantage to purchasing a property that is in foreclosure.
If the property has already been foreclosed on, there is still value to be had. Banks have no genuine interest in being landowners, and the sheriff’s office has no desire to hold onto properties longer than they have to. Therefore, properties that have already been foreclosed on may be more affordable for a buyer than properties that are in pre-foreclosure.
Risks in Buying a Foreclosed Home
The chance of buying a property way below market value is a huge benefit. However, buying a foreclosed property can come with several potential risks. First and foremost, if a resident is unable to keep up with the mortgage, chances are they haven’t kept up with maintenance. Therefore, you may be inheriting problems that you will need to address. These issues can be costly and time-consuming.
Another potential risk is that many of these properties have hidden costs, such as back taxes and liens. This can add further costs to an otherwise desirable property. The process can also take incredibly long. There is a mountain of paperwork required. To top it all off, these properties typically have a large number of bidders. A bidding war can happen, which significantly diminishes any potential bargain.
Are You Looking to Purchase a Foreclosed Home in Merced County?
No matter the type of property you’re looking for, whether in foreclosure or not, our team at Soldavi Realty is here to help. We help potential buyers in the Merced County area with their real estate needs, whether it’s buying a foreclosed property or a property that has been traditionally listed. If you’re lookingto purchase property in Merced County, contact our team today to begin your home search!
*Source: Merced County Times, “Merced Real Estate — Déjà Vu All Over Again?” August 5, 2019, https://mercedcountytimes.com/merced-real-estate-deja-vu-all-over-again/