Hi, I am planning to attend the foreclosure auction @ my local govement for the first time. According to the public announcements, I need to bring certain amout of money,usually 10% of original principle. to bid. And then “the knock down price” of the propertiy need to be settle in 15 days. I have some cash just enough to bid and have good credit. Is it possible to get rest of fund through a mortgage company just like typical home buying case? Thank you for your time.
Howdy CrystalEC:
Your standard mortgage company will take about a month to close a loan so you will not have enough time. You may want to look at a hard money loan or a private lender. The only catch is that most want an appraisal dine on the property. HML’s typically close fast and will probably have an appraiser that can get you a fast appraisal. They usually prefer their own appraiser or someone they work with. You should get pre-approved with a local HML and get all the details worked out for the most part before you bid and put out the 10%. You may be able to make the contract with the seller subject to financing where you do not risk that money just in case you can not get the balance. It is a tight rope act at best and happens really fast so you will need to get as much done prior to the auction as you can. The lender will have a check list for you as well that will help.
LOL
usually at these types of auctions u dont get to see inside the property. very risky especially when dealing with the interest rates of a hard money lender.
becarefull . go to the auction a few times first to see how it works. and then after a few times you will start to see familiar faces, peolple that go just to every auction. Get the hang of it. and then when you have a good property and the money for it, then you bid on it…
Thak you for the all your kind replies. After read your replies, I realize I need to learn more and do less risky investing first. Also as Skywalker suggested I would go to auction sites as learning process first.
Jeff. :-*