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Anyone ever buy a pre-foreclosure, foreclosure, auction house ??

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    Anyone ever buy a pre-foreclosure, foreclosure, auction house ??

    Our dream house(no ramps all flat) just came up on Zillow as going to Auction

    - at the moment it is in Pre-foreclosure .. according to Zillow
    what is the best way to approach this.. tips tricks thoughts insight information . very welcome


    We don't have cash, but we're pre-approved for a mortgage. I spoke to the old lady that lives there once a long time ago, and she declared she was never selling. I've tried knocking her door a couple of times since I found out, but no answer so not exactly sure of the situation. She doesn't talk to any of the neighbors so they have no clue. Going to leave a note in her mailbox. But considering this has hit Zillow I am sure every Tom, Dick and Harry is banging her door right now.


    Would obviously love a bargain, but at this point just want to make sure we give it our best shot as we will be kicking ourselves forever if we miss this chance even if we pay over the odds.
    At this point really don't know what to do so any insight or experience would be greatly appreciated.
    The auction is listed as occurring 14th September 2018.
    The owner of this property has been served a Notice of Sale.
    Foreclosure type: Non-Judicial
    Recorded: Notice of Sale: xxxxxxxx on 05/10/18

    #2
    Here is some information about the process:

    https://www.zillow.com/foreclosures/...sure-property/

    https://www.thebalance.com/buying-a-...e-home-1798166

    https://smartasset.com/mortgage/buyi...reclosure-home

    (KLD)
    The SCI-Nurses are advanced practice nurses specializing in SCI/D care. They are available to answer questions, provide education, and make suggestions which you should always discuss with your physician/primary health care provider before implementing. Medical diagnosis is not provided, nor do the SCI-Nurses provide nursing or medical care through their responses on the CareCure forums.

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      #3
      When you buy at auctions and foreclosure a pre approved mortgage is meaningless because more than likely repairs will be needed to obtain a certificate of occupancy. With these sales you're buying the property as is, you need the cash.

      Comment


        #4
        Exactly. Conventional lenders want an appraisal. But the way auctions are run, appraisals are often not possible. But what you could do is buy the property with a loan from a hard money lender. Then after you're in, refinance.

        Comment


          #5
          Another couple tidbits I should add since I've been down this road. Make sure you hire a REAL-ESTATE attorney, very important piece of advice right there. There are many things that can go bad with these deals. And don't count on closing in short order, even if you have the cash on hand.

          Comment


            #6
            Potential problem is how do you know what to bid without an appraisal? You could submit a low-ball bid and see what happens. But you need a competitive bid to win. How high a bid is enough to win without being too much? That takes experience. Tough call. I would be very careful as a first time home buyer without experience.

            Comment


              #7
              Thank you for the links.
              Going a little crazy reading as much as possible on the internet ..

              Comment


                #8
                This totally sucks.. not having the cash that is..
                The house is totally ok.. you could move in tomorrow.
                If we could just get mortgage for the land(lender can't really lose right, lands not going anywhere).. we'd be ok.. we could probably pull the rest together in cash, but not the whole amount.

                Originally posted by Rustyjames View Post
                When you buy at auctions and foreclosure a pre approved mortgage is meaningless because more than likely repairs will be needed to obtain a certificate of occupancy. With these sales you're buying the property as is, you need the cash.

                Comment


                  #9
                  A hard money lender?
                  Sounds like an oxymoron, but where do you look for a reputable hard money lender? any examples... never heard of such a thing.

                  Originally posted by August West View Post
                  Exactly. Conventional lenders want an appraisal. But the way auctions are run, appraisals are often not possible. But what you could do is buy the property with a loan from a hard money lender. Then after you're in, refinance.

                  Comment


                    #10
                    Thankfully, we're not in any kind of rush....
                    The longer the better in fact, this would totally work in our favor.
                    Was thinking about a real estate attorney... again being a total novice... any tips on finding a good one ?

                    So you bought a house at auction ? or ?


                    Originally posted by Rustyjames View Post
                    Another couple tidbits I should add since I've been down this road. Make sure you hire a REAL-ESTATE attorney, very important piece of advice right there. There are many things that can go bad with these deals. And don't count on closing in short order, even if you have the cash on hand.

                    Comment


                      #11
                      I've never been to foreclosure auction?
                      Wondering if it works like a regular auction where you can just keep on incrementing your bids or do they make them sealed bids?

                      Originally posted by August West View Post
                      Potential problem is how do you know what to bid without an appraisal? You could submit a low-ball bid and see what happens. But you need a competitive bid to win. How high a bid is enough to win without being too much? That takes experience. Tough call. I would be very careful as a first time home buyer without experience.

                      Comment


                        #12
                        Originally posted by NW-Will View Post
                        I've never been to foreclosure auction?
                        Wondering if it works like a regular auction where you can just keep on incrementing your bids or do they make them sealed bids?
                        Good question. I've never bought a home through auction. My girlfriend works for an investor so I hear much of what happens. I can tell you this. They've been doing it for a long time and they still struggle. If you have access to the home then so does everyone else, which reduces risk but drives the price up. If no one has access to the house and you by it on hope and luck, that keeps the price down but it's risky. I really don't know what to say other than be careful.

                        Comment


                          #13
                          Originally posted by NW-Will View Post
                          A hard money lender?
                          Sounds like an oxymoron, but where do you look for a reputable hard money lender? any examples... never heard of such a thing.
                          Personal loan (from a bank, credit union, etc.).

                          This is what my former neighbor did. She got a personal loan, bought the pre-foreclosure condo from the owner (paying off his debt and taking over the payments) which she negotiated with a real-estate attorney helping her, then once the sale closed (we are a escrow not a contract purchase state), she refinanced with a regular mortgage broker finding her a decent mortgage.

                          (KLD)
                          The SCI-Nurses are advanced practice nurses specializing in SCI/D care. They are available to answer questions, provide education, and make suggestions which you should always discuss with your physician/primary health care provider before implementing. Medical diagnosis is not provided, nor do the SCI-Nurses provide nursing or medical care through their responses on the CareCure forums.

                          Comment


                            #14
                            Originally posted by SCI-Nurse View Post
                            Personal loan (from a bank, credit union, etc.).

                            This is what my former neighbor did. She got a personal loan, bought the pre-foreclosure condo from the owner (paying off his debt and taking over the payments) which she negotiated with a real-estate attorney helping her, then once the sale closed (we are a escrow not a contract purchase state), she refinanced with a regular mortgage broker finding her a decent mortgage.

                            (KLD)
                            I've done it four times in my life, none recently. It used to be called loan assumption. I even used a credit card to scare up the cash since there was no credit check. The bank just wanted money and in case of default, the original purchaser was destined to take the hit, which happened in one of the houses. I don't know if it still works that way.
                            I have had periodic paralysis all my life. I lost my ability to walk in 2011 beginning with a spinal block, which was used for a hip fracture caused by periodic paralysis.

                            Comment


                              #15
                              Originally posted by NW-Will View Post
                              A hard money lender?
                              Sounds like an oxymoron, but where do you look for a reputable hard money lender? any examples... never heard of such a thing.
                              Hard money lenders lend for short terms at higher interest rates. They like to work with investors. I don't know if they will work with home buyers. They can be found on Google and through real estate agents. You may want to find a conventional loan if you can because of the lower interest rate. Conventional loans require a longer and more complicated process. This situation will only complicate it more. They will probably balk at your situation. But it's worth a shot. Worst thing that can happen is they say no. It won't cost you anything to find out. Look for a zero cost loan. I just closed a zero cost 5/5 Adjustable Rate Mortgage loan at 3.5%. Stays fixed at 3.5% for 5 years and adjusts only once every 5 years after that (vs most ARMs that adjust annually). Best deal out there today if you plan to pay off soon or move soon. Otherwise, if you plan to stay in there forever, a fixed rate mortgage may serve you better.
                              Last edited by August West; 22 Jun 2018, 9:27 PM.

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