Everyone knows that the number of foreclosures is at an all time high and only growing.  Many people are taking advantage of this great time to purchase real estate by buying foreclosures.  This is a great idea as foreclosures are priced well below market value and readily available.  When it comes to purchasing foreclosures there are special circumstances that come with getting financing.  These are things that you should definitely plan before you purchase a foreclosure property.

First think you should do is to inquire if you can write your earnest check out to the escrow or title company.  When you make your check payable to a brokerage you will lose precious time.  With foreclosure purchases, time is often of the essence, so eliminating the brokerage making the deposit and waiting for the check to clear before paying the title company can save precious time.

The first suggestion only works well if you have all your finances in order and all your cash is where it is supposed to be.  There is no better deal breaker in a foreclosure purchase than to bounce your earnest check.  Another way to avoid this is to have a cashier's check at the ready.  If you are purchasing a foreclosure out of state, lining up a wire transfer can also ensure a speedy transaction.

One of the trickiest aspects of purchasing a foreclosure and working with the financing is that you don't get the opportunity to inspect foreclosures sold at auction.  Pre-foreclosures, you might get an inspection.  Post-foreclosures or REOs you definitely get to complete a home inspection.  But foreclosure auctions don't allow that time.  Start by keeping your earnest deposit amount below the amount allowed in your State for small claims court.  If all else fails, you may be able to re-coup.  Then, as soon as your verbal offer is accepted, get on the horn and get an inspection completed.  Do this before your earnest check is leaving your account. 

There is nothing worse than getting a foreclosure that is going to cost you more in repairs than you had originally planned.  Not only that, but most earnest deposits are non-refundable.  Protect your finances by properly lining up your financing when you go to purchase a foreclosure.