Financing Your Miami Foreclosures Purchase
There are three stages of foreclosures, including Miami foreclosures, which are pre-foreclosures, auctions and REO homes. During pre-foreclosures, homeowners are naturally selling a property about to be foreclosed that still has little to no home value; auctions are where you’ll find officially foreclosed homes; and REO homes are properties sold by the bank. Regardless of the foreclosure stage you enter, it is important to get the financing beforehand. Don’t forget that sellers are only interested in buyers who are serious and have the appropriate financing to show.
Preparing for the auction
Buying during auction is one of the best ways to buy properties at a relatively low price. While there is the risk of having to be pitted out with other buyers, there is also a significant chance that the property you’re interested in doesn’t have any willing bidders. The first rule in buying at auctions is to check for the requirements. You are either required to bring a cashier or personal check with your bid amount or advised to come up with a specific sum as deposit, which is usually around 10 percent of the total home value.
Once you cinched the Miami foreclosure, it’s time to think about the financing. Winning bidders are generally given at least three weeks to find financing. Now, if you fail to respect the grace period, you’re likely to forfeit the deposit money. To avoid this, always come prepared.
It will tremendously helpful if you already have the financing settled before hand. After checking out the property, apply for a pre-approved mortgage. This way, once you win the bid, you can easily move the negotiation to closing faster with the financing in hand.
Still, the question remains: how can you increase your chances of approval?
First, you must know your credit score. Savvy homebuyers always check their reports every year to know if there are any discrepancies and resolve them immediately. If you’re confident with your credit score, you don’t have to worry much. However, if it’s none too stellar, you may have to postpone your home-buying plans for a couple of years or until you manage to bump it up a notch.
Fortunately, there are several ways to boost your credit score aside from religiously paying your bills and never missing a payment. Paying other loans (auto loans, student loans, even other home loans) on time can propel your credit score to new heights. The bottom line: always remember to pay your bills on time and be creative in managing your finances. Eventually, you’ll have the pre-approved mortgage you’ll need to purchase the Miami foreclosure you want.
Mark Michael Ferrer
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