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Buying a foreclosure tips wanted.

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In my search for a home, I am keep coming across foreclosed properties.I know I would not want to hassle with a short sale,is a foreclosure easier to purchase?

Are banks more responsive than they are for short sales?

 

Any tips on buying a home this way would be appreciated.I will only buy a home that is not occupied,I will not be evicting someone.From my reading so far I will be looking at REO's.Thanks.

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I don't have any first-hand info on the subject, but from what I have gleaned from the real estate centered boards I frequent, is that banks are still not ready to capitulate. The house may be worse for wear, may be vacant for 2 years now, but are still not ready to sell the house for less than the note, and why should they? If the bank sells for less than the note, they must realize the loss; by keeping the asset they can carry the loan at par...the whole "suspension of mark-to-market rules" dust-up from the past 18 months.

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View PostI don't have any first-hand info on the subject, but from what I have gleaned from the real estate centered boards I frequent, is that banks are still not ready to capitulate. The house may be worse for wear, may be vacant for 2 years now, but are still not ready to sell the house for less than the note, and why should they? If the bank sells for less than the note, they must realize the loss; by keeping the asset they can carry the loan at par...the whole "suspension of mark-to-market rules" dust-up from the past 18 months.

 

 

 

I don't know why, but I've always assumed that the folks who forclosed got stuck with the remaining bill should the house sell for less than the note...(???)

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Couple things to look into.....and if your realtor is good, they will guide you.

 

How long on average are banks taking to close these homes?

 

How badly have they been wrecked by an angry homeowner who lost the home?

 

In my area, short sales and foreclosers were not a valid option as they were generally ruined and banks were taking up to a year to close them.

 

You can run into title problems and other things you may not be aware of. Foreclosers can be messy.

 

Also.....you might want to look into a USDA Rural Development loan. You may find a nice home in your area that is eligible and you can get 100% financing with no PMI.

 

Wife and I did it as 1st time homebuyers and I gotta say, it was nice.

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View PostI don't know why, but I've always assumed that the folks who forclosed got stuck with the remaining bill should the house sell for less than the note...(???)

 

 

Don't think so...they just leave basically and have ruined credit. I cannot imagine losing my home. cwm31.gif

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A lot of banks will come after you for the loss and put a lien against you.

 

Some States allow it even if you and the bank/mortgage company agree to a short sale.

 

Some will sell the loss to a collection agency.

 

Dennis

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View PostA lot of banks will come after you for the loss and put a lien against you.

 

Some States allow it even if you and the bank/mortgage company agree to a short sale.

 

Some will sell the loss to a collection agency.

 

Dennis

 

 

If a bank forecloses on a house I think they have to pay the taxes on it until sold. I think thats the reason for the short sales. The bank gets something .The banks can chase the former owner all they want but ya can't get blood from a stone.

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house i am now living in was a forclosure i bought 7 yrs ago.

 

april 09 i bought a house that was a short sale, bank lost close to 60k on the sale. i fixed it up and rented it out.

 

signed papers last week on another short sale, just waiting for the lender to sign off on it. lender will lose 65k on the sale.

 

Banks are a major PITA to deal with but the $$$ you save makes it well worth it.

 

as far as the seller walking from a short sale they get a 2 yr ding on their credit report, the bank may or may not come after them for the balance owed, they WILL get a 1099 on the balance owed reporting it as unearned income to the IRS.

 

if you go the forclosure or short sale route find a real estate attorney who does them all the time.

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View PostCouple things to look into.....and if your realtor is good, they will guide you.

 

 

How long on average are banks taking to close these homes?

 

 

How badly have they been wrecked by an angry homeowner who lost the home?

 

 

In my area, short sales and foreclosers were not a valid option as they were generally ruined and banks were taking up to a year to close them.

 

 

You can run into title problems and other things you may not be aware of. Foreclosers can be messy.

 

 

Also.....you might want to look into a USDA Rural Development loan. You may find a nice home in your area that is eligible and you can get 100% financing with no PMI.

 

 

Wife and I did it as 1st time homebuyers and I gotta say, it was nice.

 

Is this loan just in rural areas?

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At times you can get great deals on USDA or HUD homes. The government will let these go at bargain prices and all they need is a good cosmetic makeover. There is a Free USDA website listing the houses and time of sale.

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View PostIs this loan just in rural areas?

 

 

Yeah....you can find a house or even towns really, go to the website, punch it in and see if that area or address is ok for the loan. They don't own these houses, it just a loan trying to get folks to buy in more rural zones, which in MA is silly, lol.

 

Once check a few address, you'll get a good idea of what towns to look in. It's good man.

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USDA is currently trying to get more funds before Congress goes on break .

rolleyes.gif

 

 

Foreclosed /distressed sales , I'm looking into these now , many times you will need a 203k loan (construction loan ) to qualify , this requires 3.5% down and most of the time the work needs to be completed in a certain time frame .

 

Also most of the time , they do not practice full disclosure so be wary of whats out there and be thorough with a good home inspector .

 

Google earth is your friend and will help you see water around the property, surrounding properties and lots of other goodies to help you weed out the undesirable properties/areas .

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