Step 1: Finding the Right Foreclosure

Choosing the right foreclosure is about starting with a big scope on the market and then narrowing down your options, and that starts with logging on to ForeclosureDeals.com and using our detailed search engine to narrow down our database of thousands of listings. You can target properties by town, city, county or even zip code.

With ForeclosureDeals.com, you'll be able to view listings for all kinds of different foreclosure sales, including pre-foreclosures, auctions, foreclosures and bankruptcies, by clicking the tabs at the top of your initial search results page.

Once you've gotten to the search results page, you can also sort your results by price, date of listing, or address. There are also options that allow you to narrow down your list of properties by number of bathrooms and bedrooms, or by price range, but we recommend leaving this to the last part of your search. Starting at a broad level and narrowing down the details from there will make it easier to find the specific types of properties that you want to buy.

Once you've narrowed down your list to a few properties that interest you, you can click on listings to get more details about the property and view photos of the property. You can also save properties to look at later and compare with others you find. If you decide not to pursue them, you can always go back and look for more.

Step 2: Secure Financing

Securing financing early can be extremely important. It not only provides you with an estimate of the price of a home you'll be able to afford, it also allows you to already have the money secured to move quickly to buy homes that interest you, which is often necessary in the foreclosure world. Valuable deals and desirable properties tend to sell quickly, and getting the details of financing out of the way early on can be very beneficial.

Step 3: Contact a Real Estate Agent

Discussing the prospect of buying a foreclosure with a professional agent can be very helpful, even if you don't end up using them to help you buy a foreclosure. Consulting with an experienced professional about details of the sale can be quite beneficial, especially to inexperienced and first-time buyers.

Step 4: Contact the Owner or Trustee

Once you've decided on a few properties that really interest you and that you think will provide a good value on purchase, you can contact whoever will be in charge of the sale. Our listings provide detailed contact information, whether you need to get in touch with the homeowner directly about buying a pre-foreclosure, the trustee of a public auction, or the bank representative responsible for REO and bank owned real estate sales.

Contacting the owner of a pre-foreclosure requires tact and patience. It's important to remember that during the pre-foreclosure period the homeowner will probably first seek to find ways to raise the money to pay off their default debt and keep their property. The best way to first make contact with a pre-foreclosure owner is by mail. Send them a note outlining your wish to come to a mutually beneficial agreement to buy the property. If they don't respond right away, don't despair. Use the time to do additional research into the property, including obtaining an estimate of its market value and performing a title search to check for any additional liens or debts held against it. As time goes on, the owner will usually realize that the best way to avoid a foreclosure is to sell. You can also try calling the owner or visiting them at the property, but it's best to not be too aggressive, especially if you don't have much experience buying pre-foreclosures. Once you do get a meeting with the homeowner, don't assume you are committed to the purchase. Use the meeting as a chance to learn more about the home and see if it will present a chance to buy a property at a good value.

Contacting the trustee of an auction is a much simpler process. Usually the trustee will be able to tell you just about everything you want to know about a property. They can also help you schedule a time to visit the property to get a first-hand assessment of its condition and value. Auctions are often subject to rescheduling and last minute changes as well, so contacting trustees is important to get up-to-date news about the latest sale details.

Since government REO and bank-owned properties have already gone through the foreclosure process, you'll have to contact a government or bank trustee or representative to get information about these sales. This contact information can be found in our REO listings. Often times this process can be quite simple, and you can easily schedule a time to visit the property and bargain with a representative. This method is probably most similar to contacting a traditional real estate agent to buy a home, except that bank professionals and government agencies are usually looking to unload the property simply to make back their money, unlike agents who seek to sell for the biggest profit.

Step 5: Making an Offer

Before making an offer on a property, it's essential to get an accurate assessment of the property. While our listings are some of the most heavily detailed around, it's still important to have a look at the home for yourself to accurately assess its value. Bring along an appraiser and have them give you their estimate of the property's market value. Also, bring along a contractor is a property needs repairs and have them give you an estimate on the cost of fixing the place up to market condition. Both the appraised market value and any costs associated with the property factor big into whether the property is worth buying.

Be sure to calculate all your costs ahead of time. Consider everything, from repair fees to closing costs, legals fees, back taxes or additional liens held on the property. It's very important to run a title search on the property to make sure there are no additional costs that you may become responsible for later. Cover all you bases, and use your cost analysis to determine whether the price you stand to pay for the home is discounted enough to outweigh them. If it is, then your foreclosure property is worth pursuing.

Whether you're buying at auction or direct from a homeowner, you should always know your maximum bid before you make an offer. This is the top amount you're willing to pay, and you can determine it by subtracting the cost amount from the appraised value of the home. If you pay more than this amount, you won't be saving on a purchase. You want to try to put as much distance between these two figures as possible to maximize value.

If a home becomes too expensive, do not be afraid to scrap your plans and start over! Too many buyers end up making purchases that aren't the best possible values simply because they are afraid to stick to their guns and not go over their maximum bid. Remember, there are lots of foreclosure out there, so don't be afraid to find more if the first ones you pursue don't work out how you want them to!