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I want to purchase one of those $1000 homes in New Milford CT!

Foreclosures New Milford CTBuy a home for $1000! Buy a home for pennies on the dollar! We all see those infomercials about how you can buy a home for almost nothing!!! As a first time home buyer in the Greater New Milford Connecticut area, you need to understand the pitfalls of purchasing a foreclosure and the reality of the situation.

First, I want to say I have yet to see anyone purchase a home for $1,000. Usually what this is referring to is a tax sale for back taxes owed to the town. And if you pay close attention to those, they rarely happen anyway. IF they do, there are some things you should know about properties that are sold in the State of Connecticut for back taxes.

  • The owner has the right of redemption for a year. The deed is not recorded during this period of time and because of this it is unclear of who has the right to live on the property during the redemption period.
  • Statute says the tax sale will wipe out the mortgage, however because of the way it is done, the lender may indeed come back and claim a constitutional right to defend their interest in the property.
  • Some of our Title Companies in Connecticut refuse to insure title for these properties. If that happens, you cannot mortgage the property at a later date and will have a hard time to sell in the future.

These are only a few of the reasons why purchasing a home at a tax sale is probably a bad idea for the first time home buyer, or for any buyer who isn't prepared to deal with the above. Save yourself the money, don't purchase the book from the infomercial. We don't buy properties on the court house steps here in Connecticut!

Foreclosures are often the first thing that come to mind for buying your first home in the Greater New Milford Connecticut area. After you realize that you can't buy a home for a $1000 that is. Yes, we have foreclosures, not as many as other areas. But that will change and we will see more and more.

Here is the cold hard truth about foreclosures in the Greater New Milford, CT area. Very few are in good shape! Oh sure, you might be handy, but most I have seen need work far beyond "handy"! Many have been vacant for a long time, they have had pipes freeze and break, they have water and mold issues, the septic is a HUGE unknown. (Inspections on septic systems at a home that has been vacant for a while are difficult at best, you won't get a true understanding of the system's functionality.) Remember, this is a rural area and most homes have a septic system, unless they are in the downtown area and connected to the town sewer and water lines!

For instance, you see a home listed for $80,000, what a bargain! Your heart races, you want to see it, this is your home, you can fix those little problems, you are handy! However the reality is IF you are going to purchase this home with a mortgage, you will have to have a special mortgage that requires you to use licensed contractors to fix the issues and pay them out of money you have borrowed from the lender you use. (for instance, 203K rehab loan, you can read all about the 203K rehab program here at the HUD website.) So, this $80,000 home will cost you far more, depending on the amount of work needed you may have to borrow the funds to bring the house up to a standard where you can actually live in it! And the lender will check to make sure the work was done by a licensed contractor, not by you! So the house that you thought you were going to get for $80,000 is now going to cost you far, far more!

Not to say that buying a foreclosure won't or can't happen, but be prepared. Get preapproved for a mortgage so you know how much you can spend, how much you are comfortable with. Find out what type of loan products are available to you. Once you know how much you can spend, more homes may open up to you as a possibility to purchase. Stay in touch with the real estate market, focusing on more than foreclosures in the area. And if you find a foreclosure you want, make sure you have it inspected by a good home inspector.

Call me, I would be happy to talk about buying a foreclosure in the Greater New Milford Connecticut area. You may not like what I have to tell you, but I will be up front, honest and will tell you what you need to hear, not what you want to hear, about purchasing your first home in the Greater New Milford Connecticut area.

Andrea Swiedler, Realtor, Southern Litchfield County Real Estate

2017 President, Greater New Milford Board of Realtors

2017 Connecticut Magazine 5 Star Realtor

 

 Search homes for sale in Litchfield County, CT.

 

Coldwell Banker Residential Brokerage

Litchfield County Regional Office,375 Danbury Rd, New Milford, CT 06776

 

© Andrea Swiedler 2009 - 2017

 Always do right. This will gratify some people and astonish the rest. - Mark Twain

Comment balloon 15 commentsAndrea Swiedler • June 08 2011 07:49AM

Comments

Good warnings for folks considering purchashing such homes at low prices....well written!

Posted by Kristin Johnston - REALTOR®, Giving Back With Each Home Sold! (RE/MAX Realty Center ) over 7 years ago

Andrea-You generally get for you pay for and it is wise to always, always look at the fine print and then even then there is things you don't know til after the fact. Excellent my friend. Hope you are doing well. Congrats on the feature on your previous post. I don't know as much as I should about SEO either. I get blurry eyed too. Dry reading.

Posted by Sharon Lee, Retired and loving life (Sharon Lee's Virtual Assistance) over 7 years ago

I have so many first time buyers looking for foreclosure homes that I now have a script I use to insure they know what they're getting into.

1. Are you handy?

2. If not, do you have the time to invest and the resources needed to pay for the repairs?

3. Is your marriage really strong?!!!

Posted by Craig Rutman, Raleigh, Cary, Apex area Realtor (Helping people in transition) over 7 years ago

Kristin, I hear that so much, I felt it was worth a post! Thank you!

Sharon, you are so right, we do get what we pay for. Thanks for stopping by, it is always my pleasure to see your smiling face on my post!

Craig, LOL, those are all very valid questions. Foreclosures are not for sissy's!

Posted by Andrea Swiedler, Realtor, Southern Litchfield County CT (Berkshire Hathaway HomeServices New England Properties) over 7 years ago

Way to set the Litchfield County home buyers straight on the $1,000 pipe dream of owning a home. 

Posted by Chris Ann Cleland, Associate Broker, Bristow, VA (Long and Foster REALTORS®, Gainesville, VA) over 7 years ago

Andrea: Good advice anywhere in the country... Like the old saying, if it sounds too good to be true, it probably is. We're seeing a lot of the same problems here where homes have been sitting vacant for 2 years. Often they've been broken into and pretty much everything that can be hauled away has been stolen. The successful turn arounds here are investors coming to our area and paying cash, fixing them up, and renting them...

Posted by Rene Fabre, Marketing in the Digital Age (First American Title) over 7 years ago

Chris, they often get so disappointed, you know? Thank you.

Rene, you are right, and often it is only for the investor who has the cash to not only purchase, but to rehab then rent it out. And people get so disappointed.

Posted by Andrea Swiedler, Realtor, Southern Litchfield County CT (Berkshire Hathaway HomeServices New England Properties) over 7 years ago

Andrea tell me it is not so.  That they are not telling the truth in those infomercials.  It just has to be the truth, they offer you your money back and everything :)

Andrea, excellent blog.  If the price is to good to be true, that is because it is, and you better be ready for all the surprises :)

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) over 7 years ago

Andrea, I know those commercials are so annoying! A nice doll house costs more than that! LOL

Posted by Ellen Caruso (Daniel Gale Sotheby's International Realty) over 7 years ago

This is a great post, Andrea.  We have friends that spent a number of years going after these types of properties, buying them at tax sales.  I think they wound up coming out ahead in the long run, but it certainly wasn't the get-rich-quick deal they expected.

Posted by Virginia Gardner, Realtor, Charlottesville, Serving Central Virginia (Roy Wheeler Realty Co.) over 7 years ago

I guess it's a good thing I didn't try to buy one of those $1,000 homes. I saw a real cute one that was only $647 or something like that.

Posted by EC, JF, Double R and Zoey the Cool Cat (Russel Ray Photos) over 7 years ago

George, I hate to burst your offer, but... nope, send the book back and get your money back!

Ellen, LOL, that is funny, and you are right. A good dollhouse does cost more than that.

Virginia, these types of properties are not for the first time homebuyer, yet they get so excited thinking that they can get a house for almost nothing. Bad stuff indeed. Thank you!

Eric, I guess it is indeed! Save you money for a camera instead!

Posted by Andrea Swiedler, Realtor, Southern Litchfield County CT (Berkshire Hathaway HomeServices New England Properties) over 7 years ago

Nothing like a great late night infomercial to convince people they can come to the closing table with a roll of quarters:)

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 7 years ago

I thought I am the only one getting those calls about $1,000 homes. you give an excellent explanation, but after you are getting too many of those, yo might do what I do in pathalogical cases. I tell them that if that were true, I wuld  have bought this  house on the  spot, without even looking at it.

Some people get it. Some still don't. But I am not licensed in mental health field

Posted by Jon Zolsky, Daytona Beach, FL, Buy Daytona condos for heavenly good prices (Daytona Condo Realty, 386-405-4408) over 7 years ago
Andrea you deserve a standing ovation for posting this! I'm constantly educating new investor clients about this and the "reality" of the market.
Posted by Mike Wong, Realtor: Commercial, Residential, Leasing, Invest (Keller Williams Realty Southwest) over 7 years ago

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