Question: Does it make sense to buy foreclosures?

Answer: A given number of homes are foreclosed each year. Most homes are not actually sold at auction as the owner and lender work out a deal, the house is sold by the owner prior to the foreclosure action, or everything is on hold while the owner declares bankruptcy.

Of the few properties that do go on sale, they may be purchased in a bidding process. Because of the interest in foreclosures, it is not easy to get a good deal, but it can happen.

Foreclosures are typically sold in "as-is" condition and without warranty. In some cases, but not all, an owner has a right to "equity redemption" and can actually get back the property under certain conditions.

In other words, foreclosures are like most business transactions -- it takes cash, brains, and labor to make deals work and there is no easy or immediate path to success.

As a place to start, begin attending foreclosures auctions in your community. See how such transactions work locally, and establish relationships with a broker, lender, contractor, and attorney. As well, subscribe to a local publications that carry foreclosure notices.