Has Anyone ever Purchased a Foreclosure?

[4jacks]

I think I am getting ahead of myself and planning out step 5 when I'm on step 3. But after we pay off our last bit of debt and build our emergency fund to a full 3-6 months. Then we will start saving for a house. There are lots of foreclosures out there and I was thinking if we were patience we may be able to pick up a sweet deal. So my plan was to right off the bat start lowballing the junk out of people. That way we are not really optimistic about our chances of being accepted, but at the same time, if someone says yes, then we get a great deal, and we are at our budget target price without the large downpayment. So does anyone have any foreclosure experience? I really need to pick someones brain.

[pochax]

disclaimer: no experience buying foreclosures.

BUT - from what i've read/heard, looking into auctions of foreclosures may be the way to get a great deal. the key is to do your homework and actually go see every house you consider bidding on. one problem though is you are up against real estate pros who likely know the values as well if not better than you do. thus if you do end up getting something, there is a decent chance you overpaid for it.

what if you lowball, get it, but realize you don't really want to live there? you are then at the mercy of the market to see if you can flip a profit. i think the optimal situation is find a home you and heather actually want to live in for a decent amount of time when you can actually buy it at the right time. a house is more importantly a home moreso than an investment.

[4jacks]

Thanks Chax.

Yeah, I was thinking of attending some foreclosure auctions just to try to meet some of the pros and get some tips.

An important thing to remember is I will only be lowballing on single family houses in one zip code. We have a short list of things we are really looking for in a house. One is the area, so I'm only looking in that area. Then we want a single family (not townhome) and we want a decent neighborhood to walk the dogs, or backing to the woods. Something newer than 1980, and a few other things. So I will only be lowballing on those types of homes, and we fully intend to live there. So it's kinda like we are treating this "Home" purchase like an investment purchase.

We are currently living in that area, and I've been avidly watching the real estate market for 2 years, since we sold our house. So I feel pretty comfortable not over paying. It is possible that we do get a lowball purchase but prices keep dropping. Which I wouldn't care, because the mortgage would still be in our budget.

So basically The more No's we get the longer we wait, the more we save, the less of lowballs we have to make the greater our chance of finally getting a yes, until we finally get a house.

I was just planning on starting earlier and making the low balls WAY low.

[Axel]

i have purchased a foreclosure once , but for the resale purpose . and it give me a huge profit .

[Hameed]

Foreclosure is some thing new that i am hearing over here. Can someone tell me about it in more details. and how can we generate more money out of it.

[Meredith]

A few quick tips for those interested in foreclosures:

1. You will likely be buying it "AS IS". This means you need to find out what is wrong with it. Don't plan on the sellers fixing anything for you, but at least you will know what kind of money you will be looking at to repair it (because believe me, they all need repairs).

2. Hire a Reputable Home Inspector. I don't care if you think you know everything there is to know about houses, these guys can pick out the little things that will cause you problems in the future. But don't let their report discourage you if you want the house, they all have flaws... But it would be nice to know if the electric or plumbing aren't up to code or if the foundation is sinking before you make that final decision.

3. Find a Real Estate Agent that has some foreclosure experience. They don't always do the hand-holding that a retail agent might do, but they will give you more information about the market value and make sure you are getting a 'good deal'.

4. Once you figure out what price you are willing to pay for a property, add in all the repairs and possible upgrades you plan to do and figure out what you would sell it for AFTER it is ready to be moved into. If that price is above the market value for similar homes in the area you might consider waiting on non-essential repairs. You don't want to be in the red on your mortgage before you start making payments.

5. Making an offer. Don't give up. If you offer $200k on a home that is listed for $250k you are in the right ballpark, you will likely come to terms in the middle. But don't offer $100k on a $300k house, you will be waiting until pigs fly before the bank will respond.

I hope that helps. If I think of some other things I will add them later.

[NatdL]

I also have been pondering about acquiring foreclosed properties. My sister in law is actually working in a bank so I do have some good resources...but I do find Meredith's post offer good insights...

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[Daniel]

Hi,
I am hearing foreclosure over here.Can someone tell me about it in more details. and how can we generate more money out of it.
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[Denilson]

Well Mr.Hameed you can know more about foreclosure just follow the tips of Meredith and you will get to know more details about it. He has discussed well about foreclosure.

[Franklin]

I once bought foreclosure and I bought it at very high rate. But I just sold it because I want only profit from it. Believe me I got huge profit.