I am a renter looking to buy a foreclosure as a first time home owner. I came across this posting:
$105,000 TAKE THIS HOUSE BEFORE THE BANK DOES!!!
BRING ALL OFFERS!!!
ALL BRICK
4 BEDROOM
NEW ROOF
NEW BOILER
NEEDS WORK (EST.$35,000-$45,000)
CERTIFICATE OF OCCUPANY ALREADY PULLED!!! JUST WAITING ON BUYER INFO
TAXES 2006- $3,428.46
APPRAISAL DONE IN DECEMBER/2006 “AS IS” VALUE OF $127,000.00
COPY OF APPRAISAL CAN BE SUPPLIED UPON REQUEST
ARV- $160,000-$175,000
My hubby and I have small savings, 3 kids, credit is fair, but we have decent salaries.
My question is: If we could get this house. How should we approach the seller? What contigencies should be in place? I got a one mortgage approval estimate at $90K ( two months ago, our income has increased since that estimate). But I was hoping to do some seller financing deals because of our credit.
All responses are appreciated. I have been reading up on real estate, but putting into practice is a different story for me.
what liens r on house and what is current mortgage bal and arrears?
do a title search!
remember you have fixup costs which if you get purchase price low enough you can take a home eq out right away to do them. You need to factor that into your offer. My gut says that $105 might be too much but I don’t know what other skeletons may be in the closet or not. Do due diligence. Play hardball.
First, this sounds like a “pull” ad, an add designed to pull you in and then change up. Probably either an investor looking for buyers, a mortgage broker for clients or an agent for customers. Doubtful if it’s an honest to God needy homeowner.
Second, if you qualified for $90K thru the bank, then find something that is at least $10-20K CHEAPER than that if you still want to live comfortablely and not struggle with payments. In almost all situations, a mortgage qualifier will give you the MAX that you can afford. Don’t buy at the max.
Third, if you have a small savings, how are you going to afford the fixup? Sure, it may be inhabitable, but there is a BIG difference between that and liveable, much less loveable. Getting a equityline wouldn’t be a good option if you’ve already bought at the max that you can afford, even if it’s possible (depends on what you mean by “fair” credit).
The insight is fully appreciated. I am being very careful and thrifty and I know the repairs are a major factor. We are getting on our feet and have no problem renting again, but I got my eye open for deals. Not looking to struggle with payments at all!
I will do my due diligence and check it out anyway. If it pans out to be a dud, it’ll just make me smarter for the next opportunity.