i'm interested in buying a house. i have been seeing alot of houses in the pre-forclosure/forclosure process.

Question

what is the procedure for buying houses that are in forclosure process? they seem to be the cheapest ones around here.
are there any permits involved? what is it exactly? i keep getting conflicting advice. can someone help me to understand this?

Answer 1

Go down to your local bank or a bank in the area that you are interested in. (your own bank will work as well) They have many foreclosures on their books right now and they want them gone in the worst way. Foreclosures are an immense drain on a banks cash reserves and they will help you with all paperwork and probably even give you special rates on a loan. This is a Win/Win situation. they clear their books and you get a home at a good price. Don't screw with the agents and middle men that are giving you the conflicting advise. go to the source and do it your self. Why pay agents when you don't have to. A good Escrow company will steer you through the paperwork as well.

Good luck.

Answer 2

I would agree with MOST of what the above poster said. In my area, alot of banks and mortgage companies have contracts with particular real estate brokers to funnel forclosures into. You can't get around them if you want a particular house.

Your escrow process will be longer, as many times foreclosed houses have other hidden liens that have to be taken care of. Another thing is to be ready for unknown debts of the previous owners/tenents.

I can't begin to tell you how many times I have been asked if I knew any info about the previous owners of our houses. I had quite a few calls getting our utilities turned on in the first foreclosure we bought.

Pre-foreclosure is quite a different process though. The owners who are being foreclosed on still haven't technically lost the property yet so they have to be involved.