My grandfather did this up in Boston for about 10 year prior to the recession and made tons of money, though I know now he's hurting for cash with the housing market and everything, though at the same time he was pretty high profile and a lot of his clients where pro athletes in the NE sports teams.
I can ask him specific questions if there's anything you'd like to know.
Foreclosures can sometimes be had for much cheaper. But you have to be careful and look for problems with the home. Because of the situation many previous owners do not take care of the home once they know they are losing it. Things such as holes in the walls and such are very common. Some owners even gut the home of everything before leaving.
They may be cheaper, but you have to pay more attention to the details of the home as they are often rode hard and put away wet by the P/O's . Be prepared to spend a little of the money you may save on the price fixing the “presents” the P/O's left.
Yes, Completely agree with what you said and I feel this is the best way of working out with things. It is much better in knowing the things that are really very necessary.
Are you thinking of buying to move in or flipping? Remember, if you are buying for resale, you make your money when you buy it, not when you sell it. If you don't buy it at the right price, you will never recoup any funds required for renovation.
I just bought one 6months ago, if you have any questions fire away.. first of all tho When you are buying a repo from the bank have paitence (which was very hard to have) they arent as motivated as sellers. We had a guy we know who does it all on houses come and look it over checked out roof chimney, plumbing, and esp furnace and air cond. those things sometimes are neglegted when just abruptly shut off luckly he was able to get ours going and then the waiting started took a month just to hear if they accepted our offer, and another 2 just to get the keys, we did conventional which is much better than fha here idk if its nationwide but fha is terrible wont loan on a house that has a hole the size of ur fist in the drywall or any missing outlet covers, peeling paint etc. anyway i dont pay much a month got a 1800sqft house with a large 2 car garage, 2 full baths.(one of which is in my garage!! perfect when ur working on the jeep and nature calls) and best of all got a good deal the house went to a guy for 115000 3yrs ago i got it for 70000. so i should have decent equity after i did all the work to bring her back to good condition. funny thing is me and my wife are 22 and we own a house across the street from this 30yr old guy who still lives with his mother, kinda makes me feel good not gonna lie haha. (i posted this on a different thread however I thought it would help you out too)
We went with some friends looking to buy a home. They picked a repo to look at. Because it was a large house in a good new neighborhood. We walked in and it was gutted. They took everything. Lighting fixtures, stove, washer, dryer, fridge, sinks, heat pump, outlet covers, copper pipe. If it had any kind of value they ripped it out. There was not a single piece of copper pipe in the house. and 99% of the studs that had the copper pipe in them were CUT. They even tore out and rolled up the carpet. What they didn't take they destroyed. Not a single base or wall cabinet was left in the house. 75% of the drywall was missing. Oh 99% of the wiring was missing as well. Needless to say we walked out disgusted. That place is still on the market 4 years later.
I just don't understand people. You messed up and purchased a home with an idiotic ARM loan then when it comes due and your rate goes from 3% to 12% you get pissed and don't pay your bills then you destroy the home you were too stupid to pay for. Now you are just going to hurt yourself even more by destroying that home.
The sad thing is more and more bank owned home in my area are looking like this.
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I'm not Sheldon! I'm the Flash! And now I'm going to the Grand Canyon to scream in frustration *takes two quick steps* I'm back
In my area there are some really good bargains. Yes, missing things here and there, some gutted some just missing a few things. Some in great areas, ect, ect, ect.... You have to look close at them, but if you are handy with toolds and can do it right, then that where you can make out great!
According to realtytrac.com , a real estate website that tracks trends including foreclosures, as recently as last year the national average when buying a foreclosure home was about 25 percent below the full market value of a home.
But that average may not be quite as eye-popping this year since many of the new foreclosures stem from problems in the subprime mortgage market. Many people are losing their homes after being hit with a huge jump in monthly payments once initial low interest rates adjusted up, sometimes to double digits.
Many of these foreclosures are new homeowners who had built little or no equity in their property; therefore, the amount the lender is trying to recover may be close to the full market value of the house or at most only a 10 percent discount.
Zalman Velvel, of Fort Myers, Florida, a Certified Commercial Investment member (CCIM), trainer, auctioneer and author who has been buying and selling foreclosure properties for over 20 years cautions novices to the foreclosure market to be aware of all the "land mines" involved.
If you're a homeowner in trouble, this article isn't for you. A few weeks ago, we wrote about what you can do to avoid foreclosure. We have nothing but sympathy for homeowners in trouble and nothing we say is intended to victimize them or worsen their situation.
However, let's be realistic. In any kind of market, there are buyers and sellers. If you've been priced out of homeownership the last several years, this may be your chance to get a home of your own. You shouldn't feel guilty about buying a home that's been foreclosed -- you didn't make it happen and if you don't buy the home, someone else will.
Having said that, let's get back to the nuts and bolts of buying a foreclosed home.
Land Mines
"You have to know how to do a title search," says Velvel, "or you could end up thinking you've just bought a home by paying off a $100,000 mortgage only to find out that was just the second mortgage and you have to pay another $200,000 to take ownership.
"Suddenly that great buy isn't such a good deal. You also have to be aware of [any] liens on the property because you're going to be responsible for those as well."
On top of that foreclosure homes are sold "as is" which means that the 25 percent you just saved on the purchase price can easily be eaten up by unforeseen expenses such as repairs not immediately apparent in an exterior inspection. That's because when you buy a home in foreclosure, you may not be able to look inside let alone have an inspector detect structural problems that you'll need to fix before moving in.
Something else to think about -- people who lost their home in foreclosure very likely couldn't afford to maintain their property.
So be prepared to pay for any problems such as electrical or plumbing repairs, leaky roofs, or even vandalism by angry homeowners who break things or punch holes in walls and doors, an unacceptable but not that uncommon way that some homeowners deal with the angst of losing their home to foreclosure.
Just remember that they're losing a home and you're benefiting from their loss so they may want to take out some of that rage on the new buyer the only way they can, by trashing the home that they've lost.
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