I would like to know if anyone has bought a HUD foreclosure home? What is involved in the process and is it hard getting banks to finance the purchase? Also, has anyone ever bought a foreclosure from the court house(sheriffs sale)? How would I get financing for that when you have to bid on the property? Im new at all this and my first purchase will be for myself to live in. Any info is greatly appreciated.
2006-07-07 12:54:30 · 6 answers · asked by CoCoKauai 3 in Business & Finance ➔ Renting & Real Estate
I bought a HUD home a number of years ago. The experience was indistinguishable from a normal purchase, aside from the offering process. We placed a bid on the property which HUD rejected. We re-bid a bit more then next go-around and it was accepted. From that point onwards, it was a normal purchase. We did get an FHA mortgage with slightly lower than normal fees and no points that did sweeten the deal a bit.
If you're buying at a sheriff's sale or foreclosure sale, you have to have your financing arranged in advance. A few banks specialize in this; you'll have to ask around. All of the normal qualifications and inspections have to be complete on the auction date so you often have to work VERY quickly and that's where it gets tricky. This is because you typically have to put down 10% with your bid and close within a very short time, often as little as 5 - 10 days. It helps a LOT if you have top-notch credit and can go with a stated income or no-doc mortgage. It's even better if you can pay all cash.
My ex and I tried that a couple of times and discovered a dirty little secret. The lender was usually the only bidder on a foreclosure and unless you were willing to bid near market, they'd just out-bid you and get the deed for themselves. The few tax sales that we investigated were in such poor shape that they weren't worth bidding on unless we were planning on tearing down the house and building new.
2006-07-07 13:11:34 · answer #1 · answered by Bostonian In MO 7 · 1⤊ 0⤋
these are treated generally like a regular home purchase for you. even though it's a foreclosure, you still approach it as a primary home or investment property or whatever the reason is you want to get it. generally, full asking amounts aren't told but a 10% deposit is required for the property. from this deposit you can determine what the total amount is that they're looking for. so if a deposit is $10000, you can assume the asking amount is around 100k. regardless of how high the bidding for house goes, you're still only required to make that 10% deposit in order to "win" the house. once you do, then you can proceed as you normally would as if you were buying a new house. Assuming there are no liens or any thing of that nature and the title is clean, transaction should be very smooth. once your bid is placed and you win, you have a certain amount of time, varies from state to state, on when the full payment is needed in order to fully secure the house. rule of thumb is about 3-4 weeks. that's plenty of time to get financing setup so long as you provide the necessary documents needed in a timely manner. best suggestion is to actually win the house first before going to any broker or lender. simply being if you have a house you want and all you have is 150k, it if exceeds that amount, it's a pain in the a*ss for everyone involved to either up your loan amount or look for a different house in your range. email me if you have any further questions.
2006-07-07 13:07:55 · answer #2 · answered by YOU WILL BOW TO ME!!!!!!!!!!!!!! 4 · 0⤊ 0⤋
this is what i do full-time.
HUD house offers must be made through a participating NAID broker. HUD has contracts with 3rd party property managers in every city. check w/ a local broker who specializes in HUD properties.
foreclosure sales: these are different in every state & county. some require immediate cash, some a deposit w/ closing at some point in the future, and probably a million other possible scenarios. the best way to deal w/ this is a private $ lender. another good way is to use cash advances on your credit card. if you're going to flip it quickly your interest on the credit card won't be a big deal, as long as the real estate deal is a good one. it is not the COST of money that is important, rather the AVAILABILITY of $$$
2006-07-07 17:44:24 · answer #3 · answered by bryz 1 · 0⤊ 0⤋
paying for now will be a nasty theory. it will be very puzzling to hit upon a private loan now that the sub-excellent market crashed and in case you probably did it will be a loopy exuberant interest price. Get your credit so as first. even if you probably did effectively purchase a house each and each and every of the lenders you owe money to would discover out, report adventure and position a judgment lien on the domicile besides. this may in-cumber the resources and change it from an funding to easily an section to stay on account that refinancing will be out of the question. truly, get your credit accurate first then save for a house.
2016-10-14 05:44:16 · answer #4 · answered by pelt 4 · 0⤊ 0⤋
Go to the bank and tell them what you want to do. They will probably give you an upper limit that you can bid on.
2006-07-07 12:58:47 · answer #5 · answered by Poncho Rio 4 · 0⤊ 2⤋
No, but very very seriously, if you're successful in doing so, please share your experience. Even email me!!! Seriously. good luck and God Bless!
2006-07-07 12:58:09 · answer #6 · answered by fiteprogram 3 · 0⤊ 1⤋