Let’s say you’ve been stung by the recent housing crisis and are considering a move to a cheaper property, or perhaps even lost your home to foreclosure. Real estate auctions just might provide a way to start over and move forward.
Foreclosed properties can often be won at steep discounts, as many banks, local governments and lenders are desperate to clear out their gluts of foreclosed homes and get local housing markets moving again.
This especially true in the Dallas-Ft. Worth area. In fact, according to the Denton Record-Chronicle :
Denton County foreclosure postings led the pack of the four-county Dallas-Fort Worth area for the August auction and year-to-date. A total of 561 homes were posted for the county’s foreclosure auction in August, up 5 percent from July , according to information released Friday by Addison-based Foreclosure Listing Services Inc.
Collin, Dallas and Tarrant counties all saw a drop in residential foreclosure postings for August. Overall, Dallas-Fort Worth postings dropped 17 percent for August, with 4,671 homes posted for auction, according to the data.
[...] “The higher real estate activity will actually bring us out of the doldrums or the recessionary time we’re in,” Roddy said. “The activity levels [in the housing market] are healthy, as far as sales, compared to other markets. It’s just a matter of time getting the deadwood out and getting that behind us, which will allow the market to act like it’s supposed to.”
One way of clearing out the “deadwood,” of course, are auctions. And it’s here where savvy house hunters can walk away with a steal—a welcome tactic at a time when many are struggling to figure out how to move on from the crisis.
So what should you expect when looking for a house via a real estate auction? Here are a few tips:
- Auctions are done both online and in person.
- You’ll often need to register (usually free) for the auction in advance. A number of sites listing upcoming auctions are available on line, like this one , or check out Dallas County’s listings of tax foreclosure resales .
- We recommend getting pre-qualified for a home loan before entering the bidding process. Some auctions require it.
- Inspect the property before bidding. This seems obvious, but you might be surprised about the number of people who show up expecting to learn everything they need to know about a potential property just from what’s available during the auction (a fast-paced frenzy with little time for contemplation). Furthermore, most properties are not open for inspection after the auction. Contact the sales agent ahead of time for an inspection, and consider bringing a broker, licensed inspector and contractor (if you plan to make upgrades or repairs) along with you.
- You can’t change your mind once you’re declared the winner and the purchase contract has been signed. So make sure that a) you know what you’re buying, and b) that your finances are in the order needed to follow through.
- The day itself can be a flurry of foreclosure sales, often up to 25 properties per hour. If you win the bid, you’ll usually go straight to the closing area in order to get the purchase contract signed and remaining financing loose strings tied up. Closings usually occur within 30 days of the auction.
Contact our home loan specialists for more of the nitty gritty details you’ll need to know before a Dallas real estate auction.