Buying a foreclosed home ...

Asked by sandra, 22033 Fri Oct 3, 2008

Hi Everyone,

I’ve found a home which is currently bank owned that I am interested in pursuing. However, I am a 1st time home buyer and have no idea how to begin in dealing with buying a foreclosed home. Where should I start?

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Are Andresen, Agent, Vienna, VA
Fri Oct 3, 2008
As the previous poster said, get a real estate agent to help you. It can be a complicated process with lots of pitfalls along the way. I wrote a blog entry about this that you can check out (link below.)

The first step no matter what kind of home you are purchasing is to speak to a lender. In the current market, financing is what is most likely to derail a deal.
1 vote
Cindy Jones, Agent, Alexandira, VA
Fri Oct 3, 2008
You may want to read one of my last blog posts that talks about the process. I've helped a number of buyers this year by foreclosures. The first thing you need to do is have a buyer agent on your side who knows the right questions to ask both of you and of the listing agent. With all of the changes in the mortgage world if you haven't already been pre-qualified for a mortgage then you also need to talk to one or two lenders to make sure you can get the loan that works for you as well.
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Vicky Chrisn…, Agent, Purcellvile, VA
Fri Oct 3, 2008
Archersa - I'd love to help you... it seems it's become my specialty this year. Perhaps that is because, by and large, REOs are the best deals on the market. But, there are some real challenges, and pursuing this avenue is not for everyone. Earlier in the year, I wrote a series of blog posts on exactly what you need to know to think of buying an REO. Follow the link.

The previous advise is good - get a buyers agent, and call a lender to get prequalified. Since you're new to this game, it may be hard for you to determine what real estate agent is best equipped to represent you, and where you should go for financing. I can help you with all of this. You can reach me at or by phone at 703-669-3142.
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real estate…, , Montgomery County, MD
Fri Oct 3, 2008
Talk with an experienced Agent and get preapproved.
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Pat Mulligan,…, Agent, Chesapeake, VA
Fri Oct 3, 2008
I loved Are's blog entry! Easy to understand and comprehensive, but one thing not addressed were the issues involved with the VA or FHA buyer (which is what I see the most of). Of course every market is different (I am in Hampton Roads), but having helped a few buyers with bank-owned properties, I know that "as-is" is a relative term.

Most banks have wizened up and realized that to get these homes sold, they may have to work with FHA or VA buyers whose appraisers are requiring a home to be "safe, sanitary, and secure." I am no appraiser, so I am not sure why, but sometimes we get these distressed properties through no problem, and sometimes every square inch of moisture damage has to be replaced before closing. The lender requirement of a clear moisture and termite report is the hardest (read: impossible) thing to get around. So what is a buyer to do? The house has to conform to certain standards, yet the Buyer cannot, even if they could afford it, do the work before closing or pay for it at the table. Here is where a good buyers' agent can shine.

Someone who has negotiated these before will be able to get the Buyers things that will make the house "safe, sanitary and secure" - repair money, new appliances, termite treatment, warranty, etc. Foreclosures are not for the faint of heart, certainly, but with a good agent by your side, you will be grinning ear-to-ear at closing.
Good luck to you and happy house hunting!
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Jeff Royce, Agent, Fairfax, VA
Fri Oct 3, 2008
Archersa...get a buyer's agent. They will take you through the process. Give me a call if you need help.

Jeff Royce
RE/MAX Choice
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