Real Estate Q&A: Is it a bad idea to buy a foreclosed home? – Lifestyle – providencejournal.com

Q: We are looking at a home in a great neighborhood but are nervous because the house was foreclosed by the bank, which is now selling it. Is this a bad idea?

— Jackie

A: Foreclosed homes sold by lender’s “REO” or real estate owned department can be bought at a favorable price, but there can be some downsides.

The same can be said for foreclosed homes bought by real estate investors on the courthouse steps.

If you take these potential issues into account, you could end up paying an excellent price for your new digs.

REO purchase contracts are very one-sided, so be sure to review the terms carefully. It would help if you also considered that your seller never lived in the home and might not have even visited

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