Newspaper article The Record (Bergen County, NJ)

Buyers' Eyes Opened to Foreclosure Pitfalls

Newspaper article The Record (Bergen County, NJ)

Buyers' Eyes Opened to Foreclosure Pitfalls

Article excerpt

By addressing misconceptions about foreclosure "bargains," a Pompton Plains couple were able to make the leap to homeownership with minimal strife.

For them, buying a home in foreclosure meant a lot of paperwork, but it was not a harrowing process.

One of the keys for Jaclynn Sabia and Danny Vedder, ages 24 and 29, respectively, was being realistic about the savings they would find in a foreclosure.

The couple did get a bargain in the town house they purchased for $217,000 in Lincoln Park's Deer Run development, but they also knew that they would have to invest substantially in renovation -- about $30,000.

"No one had lived here for seven years," Sabia said. "It was neglected and outdated. Everything was original and it was built in 1984."

While a complete renovation might turn off some buyers, Sabia said, they felt differently. "We liked the idea that we could design it how we want," she said.

Their agent, Fred Litzky of Weichert Realtors in Wayne, said that while buying a foreclosure home isn't that much different from a traditional purchase, buyers seldom expect all the paperwork and time that will be required.

In addition, buyers often overestimate the savings they will get through a foreclosure home, he said.

"Buyers usually think they're going to get a great deal on the property. In many cases that's true, but at what cost? The property is usually sold 'as is' without any negotiation regarding concessions," he said.

"That means in many cases you're buying the property with issues," Litzky said, "and the cost of rehabilitation is solely out of the buyer's pocket. Sometimes after the rehab, if you haven't kept control of your budget, you've spent pretty much what you would have if you purchased something else."

But Sabia and Vedder were not going into this blindly. Although they were first-time homebuyers who knew little about the process, they said Litzky kept them informed. …

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