What steps should I take when buying a foreclosed home and selling the home I currently live in?

Asked by Angela P., Cypress, TX Wed Jan 21, 2009

My husband and I aren't happy in the current house that we live in. We recently discovered a foreclosure in a great neighborhood that we would like to own instead of the one we have now. I don't know the first thing about how to make a switch. I really can't afford to pay two mortgages if my old house doesn't sell right away.

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10
Thom Colby, Agent, Irvine, CA
Thu Jan 22, 2009
Angela -

I'm a Real Estate Agent in Houston, TX and Southern CA. Although I'm currently in CA, I can put you in touch with an agent in the Houston / Cypress area that can assist you.

Thom Colby
thom@thomcolby.com
949-887-5500
Web Reference:  http://www.thomcolby.com
0 votes
Bob Phillips, Agent, Rancho Santa Margarita, CA
Thu Jan 22, 2009
Angela, you're in an incorrect area of Trulia. You wanted Cypress Texas, and your question is posted in Cypress, California. I've seen this happen a few times, so apparently it's an easy mistake to make.

Some of the posts below will give you good answers as to your best potential choices, but the most important two are, first, to ask your question to Cypress Texas Realtors, and second, sell or rent your present house before offering on a foreclosure.

Good luck.
0 votes
Angela P., Both Buyer And Seller, Cypress, TX
Thu Jan 22, 2009
I'm not sure where in the house is in the legal process. I'd imagine it's pretty far, because I've seen the price of the house get lowered twice in the last month. I don't know if it's a short sale or not.

I live outside of Houston, and our rental market it huge right now. Half the houses on my street are rental properties, and I heard that will make it harder to SELL mine. So should renting it out be a better way to go?

Here is the link to the house I want to go for, if it helps:
http://search.har.com/engine/dispSearch.cfm?mlnum=6325112&am…

Thank you to everyone who is helping answer my question!
0 votes
Cindy Mello, Agent, Ripon, CA
Wed Jan 21, 2009
Hi Angela,

I had a client in your situation recently and I had given them the same advice has the other realtors on here. However they decided to jump both feet in and were able to buy a new house at a great price and rent out theres. Now they did'nt have 30% equity or even 20% equity in there current home, so they had to put 10% down on there new home and had to qualify for both mortgages and surprisingly enough they did. Im not sure what the rental market is like where your at, but because of the many displaced homeowners due to forclosure our rental market is booming. They were able to put there home on Craigslist and had it rented in 4 days. Mind you there negative about a 100 per month on the rental but now there in a position to not only own there dream home but also now have an investment property.

Every situation is different, but all is possible when you put your mind to it and the timing is right.

Good Luck to you!

Cindy
0 votes
Deborah Madey, Agent, Brick, NJ
Wed Jan 21, 2009
Hi Angela,

Thanks for coming back online with additional info. Find out how far along in the legal process this property has progressed. Also, is it a short sale?

Can you sell your home quickly so that you can close on the new home purchase within the timeline restrictions of a foreclosure?
0 votes
Angela P., Both Buyer And Seller, Cypress, TX
Wed Jan 21, 2009
The foreclosure is actively listed by a real estate office. I found it on the Houston Association of Realtors' listings website http://(www.har.com).
0 votes
Deborah Madey, Agent, Brick, NJ
Wed Jan 21, 2009
Did you find this foreclosure listed on a foreclosure site, or actively listed for sale by a Realtor? Pubic reporting that a property is the subject of a legal action does not mean that it is for sale. Before you commence on actions to sell your home, find out if the “foreclosure” home is really or sale. If so, find out how far along in the foreclosure process the action has progressed. This will give you an idea of the timeline you face. Unless you are prepared to handle 2 mortgages, you will need to sell your home first before you buy. You can list your property for sale, price aggressively, and choose a listing agent who will market broadly. If you secure a contract on your home, you can pursue the home around the corner. There is an option of making the sale of your home contingent upon the relocation to the new home, but your buyer may not agree to this term. In a buyers market, a buyer may not need to agree to this contingency, but you can always ask for it.
0 votes
RENE LABRADO, , Fountain Valley, CA
Wed Jan 21, 2009
Hi Angela,
Lynn911 has a good point here. One thing you can do is lease the house you currently live in. Or the other thing you can do is sell your current home. This whole process might take a while depending on the price you want for your current home versus the price of the comparables. You should also keep in mind that you need to sell for more than what you purchased it for when you bought your home to pay off you existing mortgage. Check with a mortgage company to see if you can obtain a loan wether you sell your home or lease it before you do anything.


Rene Labrado
Century 21 Beachside
Rene-Century21@Hotmail.com
949-278-4837
0 votes
Dallas Texas, Agent, Dallas, TN
Wed Jan 21, 2009
If you cant afford 2 mortgages best sale your current home or lease the property in order buy home you found.
Web Reference:  http://www.lynn911.com
0 votes
Thom Colby, Agent, Irvine, CA
Wed Jan 21, 2009
Angela,

In this (Buyer's) market, you should sell your home prior to purchasing another because it may take a long time to sell the property you now own. The time it takes is directly related to location and price. If you have owned your current home for only a couple of years and have a mortgage that was close to the purchase price, you will likely not be able to sell it for what you now owe.

If you do place your home on the market prior to buying another, you will know whether you will be able to obtain a price at which you would be willing to sell.

Then, once your home is sold, you can look for another property knowing you will not have two mortgages to worry about. Just remember, a transaction is not "done" until it has recorded so don't lock yourself into a purchase unless you have a contingency for the sale of your current home.

Best of luck,

Thom Colby
Broker & Realtor
Orange County, CA
1-800-SELL-NOW
http://www.1800sellnow.com
Web Reference:  http://www.thomcolby.com
0 votes
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