Here’s a great article that explains the difference between foreclosures and power of sale homes in Ontario.
“In Ontario, a mortgage lender has the right to take possession of a property if mortgage payments are not made using either the power of sale or foreclosure process. The two processes can result in very different outcomes for a homeowner, but many homeowners do not know the differences between these processes. If you’ve received a legal notice from your lender it is important to understand which legal process is being used. Depending on which process is used, the timeline and the amount the homeowner receives after the process is completed can be vastly different.”
Check out the full article at Toronto.com
Can Buying A Foreclosed Home Save Me Money?
Buying a foreclosed home can save you money. However, it does come with some potential pitfalls for the buyer that you should be aware of. And, we thought that we might share some of these little demons to you. Of course, if you are not looking to buy a home in a speedy like process, foreclosed homes are a great way to save a little money. Especially if you have the time to wait. Sometimes it can take months to get a foreclosed home purchased.
While waiting, remember the home is sitting vacant and open for pests. It can be stripped bare of its copper plumbing or other features that squattersfeel entitled too. And, the original homeowner may have had some hard feelings and we have seen some interesting things, so be sure to get a good inspection and NOT from the home inspector the bank recommends. Ask a friend or group of people you trust for ideas. If your handy at all, this shouldn’t scare you, however, if you aren’t and want a move in ready place, foreclosures may not be the best solution.
Foreclosures are at a Discounted Rate
They are offered by the banks that have them on their books. The homes are merely an asset to the bank and not looked at as a home in any way. They will simply go in and put a lock on it, however, they won’t inspect the home to ensure that all entries are firmly secure. Most likely they even hired someone to do this for them that is a freelancer. So, when you get an inspection done, get the biggest and best home inspection money can buy and keep that report handy.
Buying foreclosed homes to save money
The banks will take their time. Remember how we stated that if you’re not in a hurry and want to save money get a foreclosed home. Well, we mean it. There are so many processes that you will have to wait for. And, unlike buying from another person that is happy to sell their home to you. Keep in mind the bank doesn’t mind you waiting and waiting. They have lots of homes to sell and they don’t have a new life to move on to. So, keep that in mind going in. The paperwork will most likely read “As is” and be sure to be fully prepared for that as well.
If you plan to strip the home and redo the entire inside, then if the original homeowner took all the sinks, they did you a favour, look at it in that light! Working with stripped down homes can actually save you some money in the long run. If the home was to be gutted anyway and all new put in this is a great way to get a home. And, just think when you’re done with the project it will be a totally new home! Perfect for renting or living in yourself and you saved money in the end. Getting a cheap foreclosed home can feel like an amazing accomplishment.