There are many pros and cons when considering buying a foreclosed Clay home at auction. You could get a screaming deal or you could win yourself a trashed house with many liens against it. Here are a few things to think about before jumping in on an auction.
First, it is important to understand how these auctions work. In Kentucky, foreclosures are judicial and must go through the court. A judge must rule in favor of the lender and then release the home for auction. These auctions take place at local courthouses. Be prepared for the price to start around what is owed on the mortgage and then go up from there. Know that there will be extra costs at an auction, including auction and bidding fees. You will have to put down earnest money before leaving the auction.
Consider Whether You Want to Deal With Liens Against Foreclosed Clay Real Estate
If everything goes well, you could get an amazing Clay home at a fraction of the open market price. However, it is a great gamble to purchase Clay real estate in this way. Most auctions do not allow for home inspections and a fair number of owners damage the property before leaving. It will be difficult to know what issues you may come across inside a home. There is also the possibility that there could be liens against the property that you would be responsible for paying. There could be unpaid taxes, insurance, back interest, attorney fees, or even child support due. These accounts will need to be settled and this could become very frustrating and expensive.
Lastly, know that auctions are competitive. Flipping houses has become a big business. These investors know how auctions and the bidding process works and will be a force to be reckoned with at the auction. If you are ready to take on the investors, are ready to roll up your shirt sleeves and do some dirty work, and are not scared of surprises, an amazing deal could be waiting for you.