does anyone have any advice on a first time home buyer of a foreclosed home???

Asked by Heather Ann, Janesville, WI Thu Nov 10, 2011

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12
Matthew Heit…, Agent, Stoughton, WI
Thu Nov 10, 2011
Hello,
I just actually posted a blog on that today!

Here is an excerpt:
Tips for Purchasing a Foreclosure

The housing slump that has affected the country over the past few years has created a large supply of foreclosed homes. This can be a good thing for buyers that take necessary precautions when looking at a home. Here are some tips for those buyers interested in buying a foreclosure.

http://blog.rockrealtywi.com/tips-purchasing-foreclosure/
1 vote
Jeff Smith, Agent, Poway, CA
Sun Nov 13, 2011
Heather -
You have some great answers already, but I will throw in my two cents. If you feel you have to buy a foreclosure, work with a good buyer's agent and don't expect to get it for pennies on the dollar. That shouldn't deter you from still working on getting a good price, particularly if there are not a lot of other interested buyers. When making an offer, keep in mind the lender/bank's first counter offer is usually full price or close to it, particularly with FDMC, that cuts you out of one more counter, so plan on you final price based on that. I always recommend and inspection and a home warranty, even if you have to pay for it yourself. This can save a lot of headache down the road. If you find problems with the home, even though it is an "as is" sale, the Seller may consider a credit back to you if it is not something they already had identified as an issue or if it is a big ticket item or a safety issue. If you have a full blown written inspection, this becomes a problem for the listing agent (at least in CA it does) as they are ethically bound to provide you with that report, so this will be a problem for the next buyer and maybe you can convince them they should address it now rather than later with another buyer at a lower price!
Overall, be fierce and try to be as nonemotional about it as you can, because if you don't the bank will!
Good Luck,
Jeff
0 votes
Heather Ann, Home Buyer, Janesville, WI
Sun Nov 13, 2011
Thank you all! You have been a lot of help. I will definitely take all of this into consideration :)
0 votes
Bill Eckler, Agent, Venice, FL
Fri Nov 11, 2011
Heather,

Yes, inspect, inspect, inspect...................and hopefully eliminate any and al suprises!

Good luck,

Bill
0 votes
, ,
Thu Nov 10, 2011
Condition of the property and timing have blown many a foreclosed property purchases. Propertty condition you can determine early enough with an inspection and than an acceptable appraisal.

Quality experienced teammates (Realtor, lender, and title company) will make sure the sale is moving along.
0 votes
Terry Bell, Agent, Santa Rosa, CA
Thu Nov 10, 2011
Lots of good advice here already, but I would add a few things, look for a newer home since there will be no disclosures from the previous owner, you will increase your chances of less problems. Secondly, find an agent with experience because the banks do not want to give long inspection periods, so you need a team ready to do inspections, give you estimates on repairs, and have it appraise by your lender without problems. The newer the house, the fewer the problems all the way around. Also, if it's in a development, then you will know that the appraisal should be a slam dunk. Best, Terry Bell, Realtor, Santa Rosa, CA
0 votes
, ,
Thu Nov 10, 2011
Aside from getting a good Realtor as stated already, you should plan to get a 203k pre-approval. You don't have to buy a home that needs a 203k loan (a rehab loan where the work is done after you close) but it's not a bad idea to have your bases covered. The customers who come to me before finding a Realtor (typically clients who find me via online resources) will usually get a 203k pre-approval and then go house hunting knowing they can buy a home in any condition (of course it needs to make sense--an experienced realtor will be worth their weight in gold during a rehab-house-hunt).

When I did my own mortgage, I told my wife we'd do this incase we found a house that needed a lot of repairs and she thought that made all the sense in the world (being a teacher, she tends to want detailed plans done ahead of time). We looked for two months and never had to bat an eye at any home, just determine whether or not the home would meet our future needs.

As someone said below, get an inspection, actually, I'll say it again, GET AN INSPECTION because a foreclosed home doesn't carry the standard disclosures, you're buying it AS-IS.

Best of luck in your hunt! Feel free to reach out if you'd like more advice/input.
Web Reference:  http://RobWeber.com
0 votes
Shanna Rogers, Agent, Murrieta, CA
Thu Nov 10, 2011
Hi Heather Ann,

'Hire' a Realtor! Make sure you do a home inspection - especially since the bank has not lived in the property so they cannot disclose to you any problems there may be with the property. Also, do a Wood Destroying Pest Inspection (aka Termite Inspection). Make sure your Realtor has all contingencies in the contract (i.e. home inspection, Termite inspections, financing, appraisal, etc.).

Good luck.

Shanna Rogers
SR Realty
http://www.RealtyBySR.com
0 votes
Jeanne Feeni…, Agent, Basking Ridge, NJ
Thu Nov 10, 2011
HIre the best agent you can find, do a thorough inspection and proceed with care. Although the bank will not make repairs, you want to retain your right for an inspection and the protection of an inspection contingency.
0 votes
Jeanne Feeni…, Agent, Basking Ridge, NJ
Thu Nov 10, 2011
HIre the best agent you can find, do a thorough inspection and proceed with care. Although the bank will not make repairs, you want to retain your right for an inspection and the protection of an inspection contingency.
0 votes
Eric D Lenz, Agent, Greendale, WI
Thu Nov 10, 2011
OK, here's some advice:
Get GAP insurance.
Be advised that the condition of many foreclosed homes may make them difficult or impossible to finance until repaired.
Note: They are a heck of a lot easier to deal with than a short sale.
0 votes
Ron Thomas, Agent, Fresno, CA
Thu Nov 10, 2011
You must have a Realtor.

You must expect some repairs.

Do not expect to buy it for 50 cents on the dollar.

Good luck and may God bless
0 votes
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