im interested in buying my first home. what are the benefits and negatives of buying a home out of foreclosure? i cant seem to get a straight answer from some sites. if anyone has a site too that would be great.
2006-12-10 06:29:46 · 5 answers · asked by egoodkis 2 in Business & Finance ➔ Renting & Real Estate
do the banks give you a chance to view the property with a repair conslutant?
2006-12-10 06:41:09 · update #1
I take it you mean to purchase a home that has been foreclosed on and now is owned by the bank (also known as a REO)?
Pro: Could be price. Usually banks assign these homes to agents who list them at or below comps. The ones listed and controlled by the loss mitigation department usually want all cash with no contingencies or they want you to be pre-qualified with them.
Cons: Homes are sold usually "As is" with no contingencies. The houses have mostly been vacant for a long period of time, therefore you usually run into issues, like with plumbing. They also are missing fixtures or need paint, new floors, etc.
The best advice I can give you is to ask your agent to look for homes that are a real bargain and let them know you're not afraid to do a little repair work.
Regards
2006-12-10 12:08:56 · answer #1 · answered by Anonymous · 0⤊ 0⤋
The pros are definitely the price. I have a friend that just finished purchasing a foreclosed home for approximately 1/3 of the value of the house. For first time homeowners, it can save you a little financial burden.
The negatives are a much longer list. Just like anything that involves the government, closing the sale on the property takes FOREVER. It took my friend approximately 4 months. Be prepared to be frustrated and make several trips to your mortgage company to deliver documents.
Unless you get to see the house before you place your bid, you also can end up with a lemon. My friend borrowed additional money to make necessary repairs, but now she's at the end of the money and has to replace the furnace to have heat.
However, you can negotiate with them to make some repairs before you close, and that takes some burden off of you.
Negatives aside, I will probably be buying my first home from forclosure, just because of the financial benefits. Good luck!
2006-12-10 06:35:15 · answer #2 · answered by tulsasfynestdyme 3 · 0⤊ 0⤋
Advantage: you may be able to get something cheap. Disadvantage: financing will be a problem, unless you can buy the property for all cash. If this is your first property, I assume that that is not likely. Best place to look: Real Estate Owned departments of banks and other financial institutions. The bank wants to get rid of the property, and may give you a decent deal (as well as decent financing) to take it off their hands. But expect to have a significant repair bill.
2006-12-10 06:35:31 · answer #3 · answered by Anonymous · 0⤊ 0⤋
The pro is the cost. The con is that you are buying it as is. If the people couldn't afford the house, it is likely that they couldn't afford the upkeep of the house and there could be several items which need repaired.
2006-12-10 06:38:07 · answer #4 · answered by Mariposa 7 · 0⤊ 0⤋
go to http://www.surelineprofit.com, hope that helps, check out all the links of the page, coz there are lots of options there for u to decide what you wanna do, good luck
2006-12-10 07:49:48 · answer #5 · answered by sizzorkay 2 · 0⤊ 0⤋