By dealing with homeowners at pre-foreclosure stage, you will have the opportunity to buy at below the present market value. Now let’s say that houses in your area usually remain unsold on the market for about five months (Although, in a few areas the average property stays on the market for about twelve months). Then you can assume that to avoid a foreclosure process, the owners need to sell their property in less than a couple of months. One important factor of how long a property takes to sell; is its price, generally, properties priced under market value sell a lot more quickly, properties priced at present market value sell approximately similar with the area’s average time on property market, and while those priced high above market value may sit, seemingly forever. For a property to be sold quickly, the real estate agent will recommend pricing the property under market value. Then it is understandable that how far below the property price is, becomes a direct function of the owner’s desperation to sell the house.

Properties priced under market value may sell quickly, so you will need to act faster and lining up adequate financing ahead of time is absolutely critical. You should spend more time with your lenders and find out what you can do to place yourself in the right position to buy a property as quickly as possible, take necessary steps that they recommend. At the very least, you will be pre-approved for a loan with an amount that is enough to cover the purchase price. Never be afraid to make an offer, although it is significantly lower than the market price. While offering $100,000 for a home listed at $300,000 is silly (and also disrespectful to the homeowner and the agent), if you offer twenty to thirty percent below the market price, you will find your offer is quickly accepted, as long as you are able to close quickly. If a foreclosure auction is coming up shortly in, say, one month, you will need to finish the transaction quickly. The auction will occur unless you and the owner can negotiate an extension by contacting the lender’s attorney.

If your present lowball offer would require the owner to sell at a loss, then the real estate agent can negotiate with the lender for a short sale that allows the homeowners to walk away clear of any debt and free. However, lenders will rarely agree for a short sale that places the money in the seller’s pocket.