The dark side of buying a foreclosed home

By Melissa Correa - bio | email
Posted by Terry Alexander - email

CHESTERFIELD, VA (WWBT) - People upset over losing their home in a foreclosure, could ruin your chance of moving into a home. A local realtor showed us damage that not only affects a sale, but a neighbor's property values.

"Oh my gosh! Close your nose, hold your mouth. You never know what you might see in one of these houses," said Realtor Kristin Birt, Long & Foster Realtors.

A few steps into this house on Kristen Lane in Chester and you know exactly what you're getting.

"We have cat litter on the floor. Stains throughout," she said.

Realtors like Birt are stuck with trying to sell foreclosed homes like this one.

"They're upset that they got kicked out of their own home and they do tear up the home before they leave. We've seen busted walls, windows, of all sorts," said Birt.

Severe damages to the inside and out make it almost impossible for a house like this to qualify for a regular mortgage. The price is drastically reduced.

"This house is currently listed at $199,000 and this is assessed at $312,000 that's just what you pay your county taxes on. It does de-value the whole entire neighborhood in itself because you're dealing with properties that are half of the value that yours could be worth," she said.

What you save on the property could quickly go down the drain.

"You might come in to this property and see a whole lot more damages than you were prepared for. So we encourage you to have thorough inspections, know this house inside and out before you buy," Birt said.

Disgusting homes like this one are scattered throughout Chesterfield County and can be found in up-scale neighborhoods like this one. Depending on the cost of repairs, it's sometimes cheaper to bulldoze the house and start over.

"More people are in financial distress than we realized and I don't think this is the end of it. Pretty sure we're going to see this through the 3rd quarter 2010," Birt said.

Right now, out of about 2,000 homes on the market in Chesterfield, 140 are foreclosed homes.

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