Does anyone know how to buy a home in preforeclosure?

Question

I found a house I like. It needs work and the realtor is telling me it's in preforeclosure. What does that mean? If I decide I want to buy it, what kind of offer am I supposed to make? Can I offer very little or will they reject my offer and feel insulted? I want to get a good deal and make it worth my while in having to do all the repairs. How do you determine a price?

Answer 1

what you do is offer the owners of the house and offer them about 5K over what they owe for moving expenses. then either fix it up or sell it quickly to make a profit

Answer 2

This may be a fantastic opportunity, but the problem is, it may be hard to find financing. If the property needs a lot of repairs, some banks will not even TOUCH that loan. You may need to contact a mortgage broker in your area for this type of loan.

As far as the offer amount, you'll have to look at comparable properties in the area and get an idea what similar homes are selling for in that area. (Not other LISTINGS, but actual SOLD homes)...Once you have an idea what it's really worth, estimate the amount of repairs it will need, and take that off your number. Then I would take a little more off in case your numbers are off to give you a "cushion".

Don't worry about insulting the homeowner. Why would you want to buy a house for more than it's worth, just to make them "like" your offer? Sometimes they'll reject your offer, then later realize that it wasn't so bad after all, so make sure you leave your contact info on your offer in case they need to call you back later.

Answer 3

It means the owner has stopped paying the mortgage and the bank is in the processes of taking it back. The bank has already researched what they think is a fair price. Ask your real estate agent to pull comparable sales in the area. She or He should be able to give you at least 3 or 4. You can make any offer you think is fair, but some people head toward the ridiculous because they heard it on some late night info-mercial

Answer 4

buying foreclosure houses is not always the best deal. those house are sold "as is" which mean after the sale bank is not responsible for any hidden damage you can find later. those houses in many cases don't have utility on, so it's hard to do home inspection. you also have to pay for survey which in normal transaction sellers is paying. price of the house is determined of how much money the previous owner owe to the bank, but don't hope that bank will sell you this house below market value. sometimes is not worthy to bay from them , because they don't lover the price on the house enough for you to invest your time and money and taking the risk buying foreclosure property. find good Realtor who will do market analysis for you and if you doing this first time add 30% more money for your repairs.( personal experience) i both 3 foreclosure in the past 2 years and i saw a lot of them. some of them can be good deal, some of them not.

Answer 5

It means that the bank is in the process of gaining title from the defaulting owner. In regards to what kind of offer you give will depend on the as-is value and what you feel comfortable with. Talk to a real estate agent to determine value. If I were you, I would pay a real estate agent, who is knowledgeable in preforeclosures and short sales, to handle this transaction.

Regards

Answer 6

Usually the actuall lender will take less than what the owner owes. If it is an FHA loan they will go down to 82%, either way you could stand to get a great deal.

Tony

www.hqhomes.com

Answer 7

usually you can offer what they still owe the bank plus realtor fees. they may take the offer to get rid of it