Question

whats makes buying a foreclosed property risky?

Answer 1

This is a kind of property (real estate) which is legally recourse by the builder or proper authority. This may happen on number of cases – such as non-payment of loan amount, not having proper insurance coverage, non-payment of tax, etc.

This type of property could be sold again in an auction; but purchasing of such is risky.

Types of such riskiness are discussed below:

No.1) Such property may not have clear title of deed. If there is any fault and the earlier owner can manage to get back the property legally, the foreclosed property investor can lose money completely.

No.2) The investor has to pay the whole sum of money on the spot. Carrying such big amount is risky, since no cards or checks are allowed there.

No.3) The investor doesn’t have any view inside the property, since it remains closed till the auction ends. An investment without seeing the property is risky.