Home Buying in Venice>Question Details

Dawn Anderson, Home Buyer in Venice, FL

What happens when the house you rent is in foreclosure? How do I go about finding if I can purchase home?

Asked by Dawn Anderson, Venice, FL Tue Dec 18, 2012

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Scott Johnson’s answer
Hello Dawn,

The previous answers are all good indicators of what can happen when you are a renter and the house is being foreclosed on. Likely you have been and will continue to pay your landlord your rent (important to do to protect your credit!) Since the house is in foreclosure you may want to approach your landlord and see if they will rewrite your lease making your payments lower until the house foreclosure is completed. Make sure you get any such change in writing and notarized to protect yourself.

In order to purchase another house for your home you should get pre-qualified at a local lender and, assuming your credit is good and you have enough money for a down payment and closing costs, hire a local Real Estate agent who can help you find a new home. There are several types of loans available, starting with 0 down (if you are a Veteran), to 3% down for Fannie Mae's HomePath houses, to 3.5% down for FHA loans - or 20% down for conventional loans. I grew up in the area, and know the housing market in Venice and Sarasota very well. There are a lot of homes for sale at reasonable prices, so buying one of those and getting out of the current house may be your best bet.
1 vote Thank Flag Link Tue Dec 18, 2012
Hello, Dawn.

This is an excellent question - thanks for asking it.

Typically, the bank has a local agent working with them as they move through the end of the foreclosure process. That agent will contact you when the bank takes possession (ownership).

Depending on the bank, you will have some options. Please be prepared to present a valid lease - that will help the bank determine what options to offer.

One of them may be to buy the property. And sometimes they will have a resource to help you get financing.

As a tenant, with a lease, you do have some rights. There will something in writing from the bank spelling out those rights and your options through that particular bank.

Don't be afraid to ask the listing agent all your questions. They should want to help you.

I work with several banks and asset managers, and they absolutely do want to help you understand your options - so think positive.

However, you have to wait until the bank takes possession. There is no short cut.

This is good information for all potential buyers - with most banks, you have to wait until they take possession to be able to buy it.

NOW - there may be an option to do a short sale if the current owner is working with the bank towards that goal.

AND, if you are qualified to buy (do you have cash in the mattress? or lender pre-approval?).

Is the house listed on the local MLS? As a short sale?

If yes, it would be wise to find a local agent with solid experience in short sales. They can help you present an offer and guide you through the process.

Thanks again - great question!

Merry Christmas and Happy Holidays to you!
1 vote Thank Flag Link Tue Dec 18, 2012
First, do you have cash to buy it? If the answer is no then you can't buy it at the foreclosure auction.

Likely the bank will buy it at the auction. They can't sell it to you now - because they do not own it, the seller owns it until they sell it or the auction occurs and someone buys it. The bank often buys it back because no one will want to pay what is owed on it now and the seller can't sell it unless they pay off the loan which likely is more than the property is worth so a lender won't lend you enough to buy it now. If it goes to foreclosure the bank will get around to selling it at some point. Once they list it for sale then you can make an offer to buy it if you can get a loan for enough. Speak to a lender at some point to see if you can get a loan. Wait for it to be listed for sale and make a strong offer. Good luck.
1 vote Thank Flag Link Tue Dec 18, 2012
Dawn,
There are several approaches you can take. However, the one with the least probability of needing to start over is to contact a real estate professional. The professional should:
1. Analyze the situation of the property as revealed in public records
2. Analyze YOUR ability and options avaialble to purchase the home.
3. Determine if purchasing that home is the most beneficial for you.
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At this point a smart agent will require you to make a commitment to use their services.
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After securing your commitment, having a conversation with the owner and discussion the options available which could include: a traditional sale, a direct sale, a short sale, investor sale, or foreclosure. Each of these instruments solve unique and specific problems. It can not be known what is the best options for the owner until that conversation and appropriate consultations have been completed.
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Then, it can be determined if YOU are the source of the solution for the problem the owner is facing. If you are are, the wheels can be put in motion to move towards the outcome most beneficial to everyone concerned.
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What you DON"T want to do is pretend nothing bad is going to happen. You need to be proactive.
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Call a real estate pro located in Venice FL.
1 vote Thank Flag Link Tue Dec 18, 2012
Hi Dawn;

If you give me the address I see what I can find out about it., or maybe look for somwthing else also.

Debbie Sterling
0 votes Thank Flag Link Wed Dec 19, 2012
Hi Dawn; If you give me tha address, and I look into for you...
0 votes Thank Flag Link Wed Dec 19, 2012
Here is a link to the Florida Landlord and Tenant Laws - http://www.800helpfla.com/landlord_text.html.

The previous responses have given you information about how to proceed. Good luck.

Tammy Hayes, Realtor
Green Lion Realty
tammyhayesre@gmail.com
0 votes Thank Flag Link Tue Dec 18, 2012
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