#4. Don't neglect additional title insurance.
Buying a cheap property that could be in foreclosure, a short sale, or at an auction may carry with it a slew of title issues that you just don't want to have to deal with. Make sure you are protected by getting your own title insurance policy. Often these properties have the most issues when it comes to the title, liens, warranty deeds, etc. so you want to protect yourself even if you're paying with all cash. You don't want anyone showing up after you close on the property to claim ownership of personal items or the home itself.
Title insurance is indemnity insurance against financial loss from defects in title to real property and from the invalidity or unenforceability of mortgage liens.
#5. Get a thorough home inspection.
Once you think you found a property, claimed title insurance, talk to your real estate agent about the pros and cons of the location of the property itself, don't neglect the final step in getting a home inspection. You have no idea what is lurking or hiding behind walls, in the foundation or in past ownerships. Do your due diligence by hiring a real estate inspector that is familiar with distressed properties or homes that need serious work. If that inspector suggests an additional inspection for something more extensive such as sewer or septic inspections, pest inspections or roof inspections, make sure you take the time and the money to get that additional inspection. By learning all you can now it will prepare you for what needs to be done later or, you have the option to back out if the property seems like it is not a good deal. This is where you can either walk away or choose to move forward. Talk to the home inspector as they tour the property. Ask them about potential costs involved to repair, replace or upgrade something. Make notes, comments, and points to consider adding up all of the cost to determine if this is truly a good value or not.
Finding a good deal also means finding a home with a good value. There are plenty of cheap, auction homes on the market today but they may not all be a good value. Enlisting the help of a qualified and experienced real estate brokerage can answer any questions you might have and help you find the right property for your needs, your budget and your future endeavors.