Home Loan Focus

Let’s get real about our home investments for a second.  There are several trends that you need to not only know but appreciate as you make your home purchasing decisions this years:

1. The Real Estate Market has been inflated
2. Mortgage Lenders have engaged in fraud that increased the real estate market inflation
3. Builders have also served to inflate the market
4. Both the mortgage market and real estate market are in correction now

Here’s what these trends mean for you.  The prices have been high, even too high and that put money in the pockets of builders and mortgage bankers and brokers.  That money came from people just like you.  Now, if you want to give your money away for nothing, then you are wasting your time reading this column.  Feel free to click away now.

The correction is taking place today and on the home shopping front the best place to find homes that have had their prices corrected the most is in the foreclosure market.  These homes have corrected significantly and some may even be value buys.  Why would you pay say 40% more for the same house through normal channels when you can possibly save $80,000 on a home that is in foreclosure.

Here are just a few examples in one of those counties that used to be one of the most inflated markets in the country, southern California.

You can find recent san diego foreclosure listings to review or la jolla foreclosure listings to review. and information from any realtor, but in doing so you essentially have to set up a relationship with that realtor.  That’s fine, but in the world of the internet, if you can do the research before connecting to a realtor so much the better.

Foreclosure listings work differently than normal real estate listings and the rules are different across the country.  Typically, you do not get the same time period to review a home or even have it inspected.  These properties are typically sold ‘as is’.  That means you could end up with a lemon.  You should approach these homes a potential money pits or homes that are only partially constructed.  You may even need to take out a construction loan and fix the place up before you can get real financing.  The point is, do not expect to go in and make a bunch of demands on the seller (the bank).  You are buying the house at what should be bottom basement prices.  This purchase should be all about the price.  If the price isn’t a sweet heart of a deal, then go somewhere else.  DO NOT fall in love with a foreclosure home when you are buying it.

If you can not approach a foreclosure property with this type of discipline, then you will be better off paying the 40% premium and looking for normal real estate listings in San Diego to buy.

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