Buying a Forclosure

[siestakeys04]

Not sure where to post but, has anyone ever purchased a forclosure home? If so did you purchase it with cosmetics repairs, or major? Is it possible to buy one with no money down and ask them to pay closing cost?

 

[loonieroonie]

I have purchase and sold several foreclosures (I'm a realtor). They are typically sold as-is. Some homes only need cosmetic repairs while others are in need of major renovations. I've bought both types personally. For most buyers that I represent we always ask the bank to pay for their closing costs. I've only had a bank say no a couple of times, but it was due to us negotiating a really low purchase price. Ask for the bank to pay for your closing costs in your contract. Read your contract addendums and understand what the selling bank will allow the closing costs to pay for. Some won't cover every charge you'll pay for closing costs.

As for down payment, it depends on what your lender will allow. Where I am we used to be able to have the seller pay for down payment, that all changed about a year ago. It's no longer allowed in the loan. But, there are many programs available to assist with down payment for first time buyers, and some programs for non-first time buyers. Have you checked into HUD homes? Where I am (Georgia) HUD is allowing buyers, who will live in the home, and are using an FHA loan, to only put $100 down. A great program.

Hope this helps.

 

[ClarabelleCowFan]

We bought our home in SC as a foreclosure at an auction at the courthouse. We had to buy it sight unseen (the inside at least) but really lucked out since it was in one of the upscale neighborhoods in town. We had to leave a deposit the day of the auction and have our financing in place within a certain amount of time (30 days I think - it's been awhile).

We had no closing costs because we got our financing from the bank that held the mortgage.

loonieroonie - that is a great program in GA. We are relocating to FL next year - wonder if that program is the same down there. Any clue?

 

[disneychrista]

I am not sure you are going to find a zero down home loan. You could do a FHA (if you are a first time home buyer) they require a 3.5% down.

I just bought a bank owned home. It does need some minor repair and cosmetic work. But it is overal in good shape.

 

[*pixie*dust*]

It is very unlikely that you will find a zero down loan in this enviroment. Your best bet for breaks on closing and downpayments would be to approach the FI that holds the foreclosure. The FI may have some more flexibility depending on how badly they want to move the property.

 

[PinkRhombus]

At least go see what you can see through the windows on it. There have been a lot of problems with people trashing their houses. Taking everything out...or teens getting in there and having parties. So, trashed, again.


We tried getting a few several years ago. They were good ones though, and it ended up the owners refinanced at the last minute on all of them. I think the chances of that are highly unlikely now, though.

 

[kt_mom]

We just purchased a foreclosure last month. It was in need of quite a bit of cosmetic work as well as a termite treatment and some work on the AC unit. Luckily the appraiser saw that the upstairs AC unit was not working properly and noted it on his report. The selling bank had in the contract that the house was sold as is but that they would pay up to $2000 in any lender required repairs. Our lender required the repairs and the selling bank paid for it. The rest we've had to do ourselves. But nothing major.


They also paid 5K toward our closing costs. We did FHA and had to put down 3.5%. If you qualify for a VA loan you can get 0% and no PMI. It's worth looking into if you've been in the military.

We're moved in now and fairly settled and love our new home. It was a little bit longer process then normal but it's all worked out in the end. Good luck!

 

[extremesoccermom]

I would love to buy a foreclosure but where do you start to look for them?

 

[kt_mom]

There are alot of sites online that will email you the info but they want you to pay them for it. Unless you pay you can only usually see the street name. In our area though it was easy to take the street name and drive by and figure out the homes usually comparing them to the online county records.

The one we purchased hadn't even made it on the site yet though. My husband drove by on his way somewhere else and the realtor had just put the sign up earlier that day. We looked at it and were ready to make an offer before the bank had even set their price yet. It was a hard couple of days waiting to find out what they were going to list it at. But it all worked out wonderfully. We got it about 100K less than it sold for two years ago and about 16K less than they were asking for it and they paid 5k in closing cost.

We feel like we got a pretty good deal. I think the bank was overloaded and just wanting to get stuff off their books.

 

[JB2K]

Finding foreclosures can be a complicated process -- fortunately, for those living in NJ, there's an agent who specializes in this sort of thing.

http://www.patmurphy.com

 

[ClarabelleCowFan]

I would love to buy a foreclosure but where do you start to look for them?

If you have a friend that is a realtor you can ask them if they get a list of foreclosures. We actually found ours in the newspaper at the auction notices.

 

[minniemee]

We recently bought a foreclosure. It was a good deal that we couldn't pass up. We got an FHA loan and put 3% down. We are just wrapping up our renovations! It was a long process as we did alot of the work ourselves!
Most of the repairs were minor, roof damage from hurricane was fixed by the bank that owned the house. This was required by our lender.
I would do it again, but only if I wouldn't have to live in the house during the renovation!!!! That was a nightmare as I hate a mess!

 

[siestakeys04]

Well we did look in the window and they took the built in microwave, the knobs off cabinets, the copper off the pipes in the kitchen, they even tool the thermostat covers off. Ceiling fans small holes in the wall but we have seen a house like it so we know the potential. We bought a home last year so can't get FHA, we said we would just wait until next year and see if it is still on the market, it would be a good investment.

 

[LKHomemail]

Most of them are in pretty rough shape. The problem is that often one is required to purchase them without inspections or even being able to walk through them. In many of these cases, homeowners "RAMBO" the property as they are not happy. In other cases, the folks just didn't have the funds to make repairs/maintenance as it was needed. If you are handy and negotiate hard and get a good deal then it might be worthwhile. Make sure you really understand what a good deal is. (Know the market, houses comps, and what repairs really cost.

I really think that in this market , you can get a regular home in great condition at a great price. Not sure why anyone would want to take on the headaches / repair nightmares for a foreclosure unless there was SIGNIFICANT savings to make it worthwhile.

 

[cjnix29]

We bought a foreclosure. The process to get in was a nightmare. We were moving halfway across the country, and ended up homeless for about a week because for some reason the bank didn't want to take our money. But we got a great deal. Only cosmetic stuff to fix, and really the only thing we would have had to do is clean. We were fortunate and didn't have ticked off owners. Just applied for a home equity line of credit, and after being in the house for only two months, we have $40K in an equity line. gotta love that!

 

[PrincesCJM]

It is very unlikely that you will find a zero down loan in this enviroment.

I'm not buying a foreclosure but the Rural Housing Program does not require a down payment. The rural housing program is great, as long as you meet the income requirements. My fiance and I did not qualify for their direct loan (money is loaned to you directly from them) but we did qualify for their guaranteed loan (money is loaned to you form another vendor). Rural housing does allow for short sales, not sure about foreclosures,

We are currently waiting to hear if the seller accepted our offer. . . . I'm not very patient at this point. We will know by 5pm tonight.

 

[Mad4Mickey]

We bought the house we are in now and it had never been lived in . The guy built it and then never moved in and it went back to the bank . He did make sure he took out the cooktop and the oven and the microwave before he let it go back though LOL . Cost us 5K to replace it all and we got such a great deal we didnt even blink . I bought my 1st house at a HUD auction and that was a mess , that house needed so much stuff done I should not have bought it . But it was my 1st house and worth double what I paid so once again it was worth it . My DD is now living there with her DH and her DD We gave it to them for thier 1st house and she is thrilled !
You have to just know what you are doing . Have your bank do your letter for your loan so you have some power when you go into it .

We are looking for another house in our neighborhood for our 20 year old son . We are only looking at forclosures

 

[dward1961]

We bought the house we are in now and it had never been lived in . The guy built it and then never moved in and it went back to the bank . He did make sure he took out the cooktop and the oven and the microwave before he let it go back though LOL . Cost us 5K to replace it all and we got such a great deal we didnt even blink . I bought my 1st house at a HUD auction and that was a mess , that house needed so much stuff done I should not have bought it . But it was my 1st house and worth double what I paid so once again it was worth it . My DD is now living there with her DH and her DD We gave it to them for thier 1st house and she is thrilled !
You have to just know what you are doing . Have your bank do your letter for your loan so you have some power when you go into it .

We are looking for another house in our neighborhood for our 20 year old son . We are only looking at forclosures

Can I be one of your kids?

 

[Mad4Mickey]

Can I be one of your kids?

Will you put the car back in the garage when you borrow it ?? If the answer is yes ..... then sure you are in : ) Shoot I just want the 20 yr old out on his own soon so this was the only way to make sure it happened LOL . He will be 21 soon and he really does not want to leave home. He did go ang look at a house today 3 streets over

 

[Ephany]

We bought a foreclosure. The process to get in was a nightmare. We were moving halfway across the country, and ended up homeless for about a week because for some reason the bank didn't want to take our money. But we got a great deal. Only cosmetic stuff to fix, and really the only thing we would have had to do is clean.

Sounds like my parent's experience. They just bought a foreclosure and waited months for the bank to get their act together. Everything was in order on my parents end 2-3 months ago, but the bank kept stalling and stalling. We think they were just trying to find a buyer who'd pay more than asking, but who's going to do that in today's market? Thankfully the electrician and plumber have said the only thing needed is cosmetic repairs. They got lucky, the previous owner just walked away last year and it's been vacant for awhile. They saved A LOT of money by buying a foreclosure; even after repairs and new appliances they'll be ahead by 100-150K.