I have a credit score of 620,single,45K a year. Looking to buy bankowned. Should I even bother?

Asked by Nat Jones, Las Vegas, NV Sun Sep 14, 2008

I'm unsure if I should continue looking for a home. As the heading says, I'm single, have a fair credit score, stable employment etc. I keep seeing television ads for auctions and in the neighborhood that I want to be in (Mountains Edge) I'm seeing lots of bank owned properties. I'm wondering with a low to middle score in the 600s, will I even qualify/be approved for a loan for something like a bank owned property? And one final question, how does the foreclosure and bank owned property sale work? I see home prices in the low 200s down to around 175K. How are these sold and what is asked of the buyer? Any help would be greatly appreciated. Thank you.

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Michael Diaz, Mortgage Broker Or Lender, Las Vegas, NV
Thu Dec 13, 2012
As long as you have a middle credit score of 580 or higher you can purchase with 3.5% down. You sound like a good candidate to purchase a home. You should get an agent though to help you purchase a home that are bank owned. Right now there is a shortage but the market should get more properties within the next couple months. If you contact me I can answer any questiosn you have and help you get pre-approved. The seller pays the agent and you really need someone pn your side. there are many great agetns on this site and if you need a referrla I have some great AAgents I work with. I strictly do the mortgage side.
Michael Diaz
1 vote
Damon Bottic…, Agent, Las Vegas, NV
Sun Nov 30, 2008
Janis makes a valid point about builder inventory. Although should know better than to try to give local advice outside of her area such as suggesting you find a new neighborhood. There is plenty of builder inventory in Mountain's Edge!

There are advantages to buying new construction but I wouldn't rule out resales/bank owned and short sales. In fact because of recent inconveniences for buyers buying short sales, many agents have decided not to show them to their buyer clients. Because of that, there is MUCH less competition and demand for these homes compared to bank owned property. What does less demand and less competition mean for buyers? Lower prices!

I have a 4 bedroom, 1880 square foot home listed in Mountain's Edge priced at $165k in move in condition. Builder pricing for the same model as of a few weeks ago was in the high 190's. Take a look at http://www.lvcash2buyer.com/Las_Vegas_NV_listings/080DAB8A-C…
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Janis Davis, , Jacksonville, FL
Sun Nov 30, 2008
Hi Nat, I am in Jacksonville ,Florida. The housing market is tough right now here. I am having success with builders inventory.B uilders are willing to pay closing costs for buyers and they are negotiating the prices for their inventory as well. Th other advantage is you will need fha financing that may not be possible with bank owned properties. I would tell you to find a new neighborhood with builder inventory and forget the foreclosures and bank owned property. They are too iffy right now.
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Linda Lipsco…, Agent, Lexington, TN
Sun Nov 30, 2008
Nat, yes apply. Not enough info to get your total financial picture. Apply for a mortgage and you will get all your questions answered. Good luck to you. Hope homeownership is right for you!! Getting qualified is the first step in purchasing any home. This will lead you to look at a certain price range to stay within your budget.
Web Reference:  http://www.lindalipscomb.com
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Klaus Dittma…, Home Buyer, State of Washington
Sun Nov 30, 2008
I just bought a Home at the Las Vegas auction, the price was about $40,000. below currently advertised homes in the neighborhood don"t forget the 5% premium added to the price.Previous to that I bid on a listed home that was in the MLS, I bid more than the asking price, they took about a week to respond and said my bid was not high enough, then a week later the called back and wanted to know if i still wanted the home. In my mind it was just a bidding war and in the end the 5 deals that were supposedley better flipped and then the wanted mine what a excersise in futility.

KD State of Washington
0 votes
Delete Me, , 89052
Sun Sep 14, 2008
Hi Nat,

There is more to getting approved for a home loan than just income and credit score. Things like other debts, how much you have in savings and reserves, 401(k)'s, IRA's....things of that nature are factored in.

The big thing that I want you hold on to is don't try to fit a square peg in a round hole. Go for a safe home loan at a fixed rate and don't fall into the trap so many other people have, and now being in the position that they are in. If you don't qualify for the type of home you are looking for today, a qualified REALTOR® and trustworthy lender will give you a good road map to get to where you want to be in the future.

The process of buying a bank owned home in a lot of ways is exactly the same as buying from a non-distressed seller. Differences are is that you will not be notified of any defects or known problems with the property, and properties are usually bought in an "as-is" situation.....meaning what you get is what you get. With the help of a qualified and knowledgeable REALTOR®, the home inspection and appraisal processes, while no warranties are presented, at least you know you have done everything you could have to ensure your purchase is the right one.

Plan on 45 days from the time you have a fully accepted offer to the time you get the keys in your hands. The best thing to do is to get pre-qualified with a trustworthy lender and to have a consultation with a qualified REALTOR® to get you on the right path. If you would like any suggestions for some lenders, I would be happy to refer you to a few.

All the best,

Mike Dobranski, REALTOR®
Prudential Americana Group, REALTORS®
Las Vegas / Henderson, NV

0 votes
Len McGuirk, , Las Vegas, NV
Sun Sep 14, 2008

I have helped many buyers in your position gain homeownership. I am also an expert when it comes to bank properties and how to negotiate to your advantage when writing an offer. The first step you will want to take is to talk to a good lender so you can get pre-approved for a loan. This will allow us to know exactly how much you can comfortably afford. I am already thinking of some options for you that will probably work. I have a great lender that I can connect you with too.

Please call me so we can discuss your situation more in depth and get started. My service is free to buyers. Once we have an idea of your qualifications, we can then start looking for the perfect home for you. This is definitely a strange market, so you will need to make sure you write any offers so they are to your advantage. Bank properties are not currently sitting on the market very long at all. So once you find a home you like you will want to be prepared to put an offer together. In the price range you will be in, most likely there will be multiple offers on most bank properties, so this is where my negotiation skills come into play.

I would love to speak with you more in depth. You can call my cell below. I look forward to hearing from you. Thanks for your time and have a great day!

Len McGuirk, Realtor
Prudential Americana Group
(702) 203-6688
0 votes
Scott Godzyk, Agent, Manchester, NH
Sun Sep 14, 2008
Your first job should be to find a local and trusted loan officer, stay away from internet brokers, and get prequalified. then you will know up front what price range you can afford, what your monthly payment would be and how much you need down. then find a buyer broker to look out for your best interestes. you should be able to negotiate before signing so that they get paid by the selling agent through the conbroke fee offered in MLS. Then they can search out the properties in your price range. if you choose to go to a bank owned listing, know you are buying it as is, do your inspections prior to bidding, be ready to close in 30 days, make sure your deposit is at least 1% of the sales price and in certified funds, dont ask teh bank to fix anything and if you need money back to close, add that to your offering price as otherwise your bid may not be accepted. good luck with your purchase
Web Reference:  http://www.ScottSellsNH.com
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Devan Reaves, , Henderson, NV
Sun Sep 14, 2008
You are capable of obtaining financing. The auctions areone avenue to travel, and there is one currently going on as I type this message to you. FHA financing is based upon income primarily. The credit does play a factor, but government financing allows for more caveats than conventional financing. Many people will tell you they can prequalify you based on what your title says, but until you take a thorough look at your overall debts compared to your income it is a less than educated guess.

I am not trying to discourage you as I believe in this market you would be wise to take advantage of the prices of homes. If you are looking to buy a bank owned property you want to find an agent who is versed in REO's and fully understands negotiating with the asset managers at the bank. This will ensure that you get the best terms on the home.

Damon is right in saying speak to a lender first. Many banks and agents will not take you seriously until you have obtained a prequalification from a broker/banker or a pre-approval. This also helps in the bank owned property as it shows that you are essentially walking money, and capable of helping the bank remove one more red mark from the books.

Devan Reaves
Mortgage Consultant
North American Financial
Office: (702) 407-9335
Direct: (702) 686-4819
0 votes
Damon Bottic…, Agent, Las Vegas, NV
Sun Sep 14, 2008
Hi Nat,

First step would be talking to a lender to find out exactly how much you'll qualify for. There are quite a few homes in your area priced under $200k including bank owned, short sale, auction, and even regular non-foreclosure homes. At the auction (REDC), you will need to show up with $5000 cashiers check in order to bid. The highest bid must still be "accepted" by the seller and keep in mind, they will add an additional 5% commission to your bid. (Win the bid at $200k, you'll pay $210k)

There are bank owned homes and non-foreclosure homes available in your area that will not be in the auction. They can be purchased by submitting a written offer and negotiating with the bank or seller. In the written offer we'll specify a due diligence period for inspections. I prefer these properties compared to the auction because it allows time for the buyer to get a proper inspection and pull out of the deal if major problems are found.

From my website, you can begin the pre-qualify process here: http://www.VegasProperty4u.com/prequalify.shtml
You can also search homes for sale by zip code or area. You can specify if you want the results to contain bank owned homes, foreclosures, and/or short sales, etc...

Click on my profile to contact me if you'd like to learn more about how I can help you find and purchase a home.
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