Emotions are at work at foreclosure auctions. Many buyers overbid while some make serious mistakes that cost dearly. Here are some common mistakes that you should avoid at foreclosure auctions.

Agreeing to buy foreclosure without inspection it

Don't ever make an offer for a foreclosure property without having full professional home inspection.

Set your maximum price and don't ever exceed it!

Auction fever is common. Set the highest price that you may consider and stick to it if you find yourself in heated bidding.

Remember that you can buy the foreclosed property after the auction as well. You can contact the bank or lender and negotiate if the property is not sold but owned by the bank. You can even make an offer to the party who purchased it if you feel, later on, that the property deserves higher price.

Don't buy a foreclosure property without title search

Make sure that there is no additional amount that needs to be paid for any other lien on the foreclosure property. Remember: foreclosure means trouble and troubled homeowner may have other financial problems related to the foreclosure property. Desparate homeowners try to exhaust all financial possibilities before letting their homes go through foreclosure process.

Title search reveals all ownership and liens on the foreclosure property.

Insuring foreclosure property

Don't even let one day go by without a home insurance once you own the foreclosure property. Foreclosure properties are subject to vandalism when they are vacated. Previous homeowner may cause damage or take some items and even some major components (dishwasher, washer/dryer, etc.) from the property if the keys were not replaced.

Redemption period for foreclosed property

Foreclosure laws of some states have foreclosure redemption right to protect the homeowners losing their homes at foreclosure. Previous homeowner can buy back the foreclosed property by paying the full loan amount plus accumulated interest and other expenses. Redemption period varies from 3 months to 12 months.

First check the foreclosure practices of your state. If you are in a state where redemption right is in the foreclosure law, then avoid making serious investment in the foreclosure property until redemption period is over.