Foreclosure in 19701>Question Details

Lewis Brice, Home Buyer in 19013

what is the process of buying a foreclosure ? what are the pro and cons of buying one ?

Asked by Lewis Brice, 19013 Wed Nov 4, 2009

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Jacqueline Roark’s answer
Buying a foreclosure is just like purchasing any other property. The difference is most banks make you sign an addendum saying you are buying the home as-is, and some other terms and conditions, but they will give you time to inspect the home and determine what repairs are needed.

Pros:
Get house at a reduced price
Settle quickly
Most banks will pay closing costs
Some banks will make repairs
Clear title (Homeowner Association fees paid up, etc.)

Cons:
Home probably needs work, may not be in move in condition.

Don't assume anything - ask before someone tells you they won't - it's part of the negotiation process. The as-is addendum doesn't always mean "as is".

Foreclosures are an excellent investment as are short sales. The biggest con with short sales is the time it takes for the bank to approve your offer.

If you have any other questions, feel free to give me a call at (302) 540-5373.
Web Reference: http://www.jroark.com
0 votes Thank Flag Link Wed Nov 4, 2009
The process for purchasing a forclosure is the same as any other transaction depending upon you type of financing. Banks like to settle as fast as possible/ A pro to purchasing a forecluse is that you can usually get a house at a reduced rate. A con is that forclosures usually need work and banks aren't willing to do any work. A pro to that is that they have rehab programs that while lend you money to fix up foreclosures. I actually list foreclosures for banks so I am very fimilar with there process. If you have any more questions or need more information feel free to contact me.
0 votes Thank Flag Link Wed Nov 4, 2009
The word foreclosure is now a great buzz word, which few consumers truly understand. There are homes that are in pre-foreclosurer and homes that have been foreclosed on by the bank. If you want to buy a home that has been foreclosed on by the bank, it is very easy. The bank list it for sale with a realtor just like any other home. The process for buying it is no different than buying any other home that is listed for sale. You submit a purchase offer with an ernest money deposit. The selling bank will either accept your offer, counter your offer, or reject it outright.
If you want to buy a pre-foreclosure, which is a house that the bank has started the foreclosure process on, you have two options. If the person that owns it has listed it for sale you can make an offer just like any other house. You submit a purchase offer agreement with a ernest money deposit. The seller can accept, reject, or counter. Now if he is selling it for less than he owes the bank, then it is a "Short Sale". This means the bank must agree to let the seller, sell the home for less than they owe the bank. This process takes from 4-6 months. In the end, the bank can still say "no" and foreclose on the house. The other way to buy the house is to bid on the house when the sheriff sales the house at auction. You will need cash to do that because you can't get a traditional mortgage to buy a house at the auction.

If you are not buying the house cash, you will need a mortgage so you will need a pre-approval letter from a mortgage company in order to submit a contract to buy a house. If you need help getting pre-approved or have more questions, feel free to call me at 302-703-0727 Office or 302-588-3665 Cell.

You may also want to attend the next First TIme Home Buyer Seminar on November 21, 2009 at The Christiana Hilton Hotel in Newark, DE. There are two sessions, one from 10 AM till Noon and again from 1 PM till 3 PM. You can call 302-588-3665 to register or send an e-mail to DelawareMortgages@yahoo.com

John R. Thomas
Certified Mortgage Planner
Primary Residential Mortgage, Inc
42 Reads Way
New Castle, DE 19720
302-703-0727 Office
302-588-3665 Cell
http://www.DelawareMortgageLoans.net
0 votes Thank Flag Link Wed Nov 4, 2009
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