Hi Trevor,

Another thing to be aware of is the price range of the type of property you'll be hoping to acquire. Right now, in South Orange County, from Orange South, here are realistic selling prices for: A two br. condo with a 1 car detached garage: about $225k. A 2 br. condo with an attached garage: about $275k. A 3 br condo with a 2 car attached garage: about $310k. A 3 br. single family detached house with a 2 car garage: about $400k+ Those are for "nice" properties in relatively move-in condition.

Those are realistic sales prices if you are the lucky bidder among 5-25 other bidders. The stronger your prequalification - meaning, having ALL your ducks lined up - the better. You WILL need:

1.) pre-approval from a DIRECT lender,
2.) a copy of the first page of your credit report, hopefully showing a good FICO score,
3.) a copy of your recent bank statements, showing an amount necessary for not only the down payment,
( usually 3.5% with FHA.) but also sufficient for closing costs, ( another 1.5% usually.) plus possibly reserves. ( ask your lender about these.)
4.) a copy of your earnest money deposit cashier's check - for up to 3% of the purchase price, and last,
# 5.) A well crafted offer with as few contingencies as possible, wriiten by an experienced agent who has been showing you all the properties you needed to see before deciding to make an offer. Trust me, there should be quite a few of those, to help you get a feel for the appropriate pricing for houses in the area you're targeting. ( A side note - do not get pushed into making tons of offers, wasting your time - be selective. Become familiar with, and comfortable with, the pricing first.)

The bottom line is that you need professional, experienced guidance to navigate the complexities of not only finding a prospective new house, but actually negotiating it to being yours. If the above requirements make sense to you, and you feel that you're in a position to proceed with all those criteria as part of your package, then it is time to choose a great lender - I have one of those - and a great Realtor. With 32+ years local experience, I humbly submit that I am qualified in everything I have described above.

Good luck in finding and acquiring your new house, Trevor!

Trevor, Just to let you know, buying a bank owned house with an FHA loan is possible but the lower priced houses, that are a good buy, go to cash offers. You are going to have to put in multiple offers before you get one. Just to give you an idea, in Lake Forest under $400,000, there are only 5 properties available, that are REOs.
Everyone else on here has given you good advice and do your research as to what you want to do. Pick everyones brain.

Good Morning Trevor,
In direct answer to your question, you are almost ready . There are still a couple of things you need to have redily available. You need bank statements, and a copy of your account where ever you have your down payment funds. In California a reeal estate agent is the best person to help you find your home. Your CPA and attorney can help you if you feel there are things you require beyond the scope of your Realtor. Your Realtor should be able to answer your questions and guide you through your transaction.
Did you know that almost all auction homes are offered through our system PRIOR to the actual auction? I can show you the home and you can put in an offer before it ever goes to the auction. If you have not already done so it would be in your best interest to sit down with a Realtor and go over the process. Please contact me or another Realtor of your choice and discuss all your options. I wish you much success in your endevor.
Connie Bramble
Prudential CA Realty
714-337-8718

Trevor:

If you are planning to purchase real estate in California, using a licensed real estate professional is in your best interest and the great part is, you don't pay for this, the seller does. Make sure you are working with someone who is knowledgeable in foreclosures.

Now if you planning to purchase a home at the Trustee's Auction on the court house steps, then you need CASH, not a pre-approval to do that. And don't be mislead by the RealtyTrac "pricing" for these foreclosures. All this represents is the either the delinquent amount of the loan that is in default or in some cases the outstanding balance of the loan in default. Unfortunately, this may be a 2nd or 3rd TD and that information is ot disclosured. Trustee's Auctions are not for the average home buyer. That being said, if you have the cash and get the eduction (or work with a professional who knows the ropes), you might land a great deal here.

If instead, you are talking about purchasing a home from one of the post foreclosure auctions conducted by the big auction houses like Williams & Williams or Hudson & Marshall, then you will need to check if they will accept FHA financing on the home you want to acquire and check all the bidding terms too. Again, using a Realtor who is experienced in these types of auctions is in your best interest. You want to make sure that you have done your due diligence both before the auction and also once you are under contract. A licensed professional as a part of your team is a good thing.

Hope this helps. If you have any further questions, feel free to contact me directly through my profile. Dare to Dream.

Shel-lee Davis
Your Real Estate Consultant for Life
RE/MAX Palos Verdes Realty
http://shel-lee.listingbook.com

Hi Trevor,

Are you talking about going to the Trustee Sale to buy the homes? If so, you will need to pay cash by cashier's check at the time of the auction. So you need to be prepared for the home you intend to buy. The property is also sold as-is, so you would only want to do this for a property you have already viewed, perhaps pre-foreclosure. It's a big risk to do this at an auction.

If you wait until after the bank-owns the property...then a Realtor can help you. They are listed on the MLS as other homes are. You would have all the normal contingencies and protections that way.....home inspection being one of them. FHA does require that the home is "livable" so sometimes properties require repairs before FHA will finance the home.

You are right that prices are looking very good these days.....I'd be happy to help you with this if you would like?

Karen