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Thread summary:

Loan process: foreclosure, Sheriff sale, county courthouse requirements, poor condition, as is buy

Old 03-03-2007, 05:11 PM
Location: arrlando, flarida
2,227 posts, read 7,532,379 times
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if one found a foreclosure that they were intersted in purchasing someday, does anyone know what the loan process is like? do you have tp pay cash for the house, or do you have to put down a significant amount of money to please the banks?
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Old 03-03-2007, 06:09 PM
Location: NE Florida
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when you say someday do you mean at the Sheriff sale? If so I would call the county courthouse and see what their requirments are.
If you are thinking of a house that is either in foreclosure or about to go into foreclosure. they you will have to try and buy the property from the owner. Untill the Sheriff sale the bank can not discuss the property with you.
sometimes banks will consider "short sales" but it depends on the situation.
Just a heads up that I am sure you remember from another post, a majority of time the properties are in poor condition, and if you are buying at SS you will not be able to view the property.
I hope this helps

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Old 03-03-2007, 06:43 PM
Location: Ocala area in Central FL
627 posts, read 2,615,303 times
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Is this property listed for sale with an agent?? or is it going into foreclosure??

Buying a foreclosure that is listed is no different than buying a home placed on the market by any other owner. You do buy them AS IS, many times banks or mortgage lenders will not make repairs, other than those that may have been made to secure the property from weather and or vandals, prior to listing.

After working with these homes for several years, I can tell you that they are left in good condition, some are just dirty and yes, some do need work.
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Old 03-03-2007, 06:49 PM
Location: Tampa Bay
598 posts, read 2,031,150 times
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The short answer is financing will work, although the bank or financing company may not approve the house you are interested in, depending on the condition. You have to keep that in mind when looking at REO's.

I can only relay my experience from what we learned/did while looking for a house. The first thing we did was to get approved for a mortgage by our bank. With the approval letter in hand, you are taken seriously as a guaranteed buyer and the realtor & seller KNOW you have the funds available. Now when you say "foreclosure", there are 2 types that we have dealt with: the bank forclosure and the HUD forclosure. With both types you have to do your dealing through a realtor as we understood things (we did put in offers on both types btw).

Both types require proof of funding up front. The HUD type requires a partial payment at the time of winning the bid. But if you have your loan all set beforehand it's no different than having cash... just the mortgage co. makes the payment for you.

Bank forclosure is when someone defaults on their regular mortgage that is not protected under FHA or VA programs. (There may be other programs I'm not aware of, but these are the 2 that we always ran across). With this type your realtor deals directly through a REO specialist, who then deals with the bank, or possibly your realtor may do the dealing directly. Things are pretty much like a normal house purchase except that the process can be extremely long and drawn out. We were dealing with a bank in CA who was in no hurry to look at the bid and decide on anything. They basically get to it when they get to it. lol With these, you can have your inspection done before the offer is accepted if you like and back out at anytime before finalizing things based on the inspection results.

The HUD forclosure is insured through a gov. program and these homes are auctioned off. Your bid is placed through your realtor and the process is done on a schedule. Homes put up for bidding for the first time cannot be bid on by investors or companies, they are reserved for private resident bids only. If the auction is not successful, bids are open to anyone the next time around. If you win, you have a percentage to pay (I think it was within 3 days) and the rest afterward. During the 3 days you have the ability to have your inspection done and back out of the deal if there is anything major found that you're not comfortable with.

My advice to you would be to go out every weekend and look at ALL the foreclosures in your area for a few months before considering getting into any deals. If you do this every weekend... check the HUD listings... and go look at all of them, you will find some open and many people also checking them out. SOME of these folks are RE investors who you can learn a ton from by talking with them. Everything from all the points in the process, to how to spot certain problems with a property, to leads on other properties coming up for sale/auction or houses to stay away from.

There's alot to learn and the process can be quite different from the usual. Also there isn't the disclosure requirement in place like you have with normal home sales. It is an "AS IS" sale. So your own knowledge in spotting problems with a property and the inspection are THE most important aspects of it.

Btw, both our forclosure deals were dashed by major problems revealed during the process but our good friend did get a bank REO and it was fine, just needed cleaned. Good luck!
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