Buying A Home
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Our tech team has launched updates to The Nest today. As a result of these updates, members of the Nest Community will need to change their password in order to continue participating in the community. In addition, The Nest community member's avatars will be replaced with generic default avatars. If you wish to revert to your original avatar, you will need to re-upload it via The Nest.
If you have questions about this, please email help@theknot.com.
Thank you.
Note: This only affects The Nest's community members and will not affect members on The Bump or The Knot.
Buying a foreclosed home good or bad?
My husband and I are considering buying a foreclosed home. This will allow us to buy a bigger home at a reasonable price. I know we will have to accept it "as is", which is fine. My husband is a Contractor and so we could make any necessary repairs ourself.
Anybody had experience with this? Does the process take longer than buying a "traditional" home?
Re: Buying a foreclosed home good or bad?
Yes, bank owned. I should have clarified, a home that has made it all the way through the foreclosure process.
We recently purchased a bank owned foreclosure.
Although it was listed as "as is" we got the bank to agree to a LOT of expensive repairs (new deck supports, a/c, stove top). So, don't be afraid to ask...in our case, they wanted the sale!
As for the time, it was like a typical sale. We saw the property on the third day it was listed, submitted an offer 3 days later, and after several negotiations, settled on a price at the 14 day mark. We closed in just over 30 days. Bank negotiations are typically slower, but once the agreement is in place, they want to move at warp speed to close!
FWIW, you can possibly get a really good deal if the bank is willing to negotiate. Our home appriased for well above what we paid which was significantly less than asking (they also paid closing costs, home warranty and one year termite treatment).
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We're buying a home that is foreclosed. The bank did agree to fix several expensive things like back yard draining, and mold remediation. They know that NO ONE will buy the house unless some basic repairs are met.
We're also getting an FHA loan. This has slowed down the process significantly, and our closing is probably going to take place about 75 days after signing a contract. FHA inspectors require a lot of little problems to be fixed, and while the bank is willing to do major repairs, they're not as eager to do the little repairs that a buyer with a traditional loan would probably overlook.
If you can get a traditional mortgage, then I would say go for it - especially if you can swing a lot of the repairs yourself. But if you're doing an FHA loan, I would avoid it like the plague.
Cortlandt Place - My house blog
We bought a foreclosure a couple of years ago- the process is very similar to buying from an individual- you're just negotiating with the bank. I actually found the bank far more reasonable than the three other sellers we tried to buy from before we found this one.
It enabled us to buy a house in a neighborhood we wouldn't normally have chosen because the price range was just a smidge out of comfort level (perfect at the foreclosed price)- with excellent schools and a park like backyard. It was really an excellent decision even if we had to do some repairs and upgrades ourselves
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Yes, we are planning on going the USDA route as well. We are going to look at a few houses tonight. Thanks for the info, very helpful and encouraging!
You got lucky that they agreed to mold remediation! We put an offer in on a house and they would not remediate the mold in the basement. We also had planned on going FHA and they told us to get an FHA 203(k) loan and fix the mold problem ourself. Needless to say, we are still looking.
We also found out about the USDA program for "rural" housing. And it is weird what areas they consider rural. I was thinking we would have to go way out in the country, but we are looking in a nice subdivision tonight that is within walking distance to a grocery store, etc. Cross fingers we can find something worthwhile.
I wrote a blog post about this:
http://stephanielsolano.wordpress.com/2011/08/19/thinking-of-buying-an-reo-or-bank-owned-foreclosure/
Yes, it typically takes longer because the banks will meet once or twice a week to look at all the offers. ?It's not like a normal owner who gets the offer and replies back in a few hours. ?
Once contract is in the works, there is typically the 30 day clause that they have to meet (closing day). ?So, that's a standard time frame once you get to that point.
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