My credit score is between 650 and 670. I am planning to buy a house with my husband and his credit score is above 800.
Are foreclosure homes better deal?
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- Find Menifee Foreclosure Homes and Foreclosure Bailout Lenders
- Bankruptcy, Foreclosure, Short Sales & Rebuilding your Credit – FINANCIAL RECOVERY
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Here’s a word of caution about foreclosures: The bank does not have to submit a transfer disclosure statement (TDS).
When a person sells a property that is not in foreclosure (not bank-owned), they must include a TDS document that lists everything about the condition of the property to the best of their knowledge. Failure to disclose a problem with the home (and I mean just about anything) could result in the buyer coming back at the seller – and his real estate agent – after the sale to sue them for non-disclosure. So, agents and sellers are usually pretty thorough and honest about this (usually).
But, since a bank has acquired the home from the previous owner without any knowledge of its condition, they are exempt from providing the TDS. It is then up to the buyer to make all of the required inspections to determine the condition of the property prior to close of escrow. And, if there are any hidden problems, it could turn into a money pit for the buyer.
Also, consider that the people being foreclosed on are usually pretty upset, sometimes to the point where they strip and/or trash a place before leaving. When looking at foreclosure condos, we actually found one where the toilet had been removed and concrete poured down the drain. Another one we saw had everything – light fixtures, interior doors, cabinets, countertops, heaters, even the shower heads – ripped out by the previous owner.
That stripped place was listed for about $40K less than model matches in near move-in condition in the condo complex. But, it would have taken at least that to bring it back up to liveable condition.
There are many places to find foreclosure properties, but I would start by going to your bank and finding out how much they will allow you to spend and if they will lend money to you on a foreclosure property. When you are buying foreclosure properties, you’ll need to have the money available very quickly. In some cases, you’ll need to write a check for the home the same day. You’ll need to have all the details worked out with your lender ahead of time, so this is possible.
If you don’t intend to buy a home at the sheriff’s sale, then you’ll be looking for Pre-Foreclosures or REO Properties. These are properties that the bank has already bought back from the sheriff’s sale (REO) or properties that have not gone to sale yet, but are in default (Pre-Foreclosure). In either case, the owner (the bank or the individual in default) may be trying to sell the property as quickly as possible. The home may be listed with an agent, or it could be for sale by owner. Either way, these are usually considered “distressed” properties and should be selling under the current market value.
Right now, because of the real estate market, you can buy just about any house under it’s market value, so don’t just limit yourself to foreclosure properties. Make sure you find a home that you love and one that doesn’t need a lot of repairs.
If you would rather find something that needs repairs and fixing, so you can trade your own labor for a great deal, then you’ll want to contact local real estate agents and ask if they have any “fixer uppers” or foreclosure properties that need work. You can buy these home for much less than they would be worth in good condition. But make sure you do a complete inspection before buying, so you know what you’re getting into.
Be careful when getting into the foreclosure market, there are many people who have lost money buying foreclosures, and there is a lot of fraud in this industry. Make sure you only work with a reputable company who has specific experience with foreclosure properties.
Hi! Good luck with your home purchase.
I found several articles on eHow about buying foreclosure properties.
Here’s how to understand the stages of foreclosure to get the best deal when buying a foreclosed property:
http://www.ehow.com/how_4395266_home-foreclosure-best-buy-deals.html
Here’s how to find foreclosure properties without paying money:
http://www.ehow.com/how_2383203_foreclosed-foreclosure-real-estate-properties.html
Again, good luck!