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Posted: 11/2/2009 8:25:12 AM EST
Just like the title says.... any general pitfalls I should be wary of (except the obvious things that may need repaired with the home)

Personal expereince greatly appreciated!

Thanks!!
Link Posted: 11/2/2009 8:42:44 AM EST
No expirience in this, but I might be worried the old owners would come back to start trouble
Link Posted: 11/2/2009 8:54:59 AM EST
[Last Edit: 11/2/2009 8:57:03 AM EST by douglasmorris99]
Pay for a professional apprasior and be there when they do it, and be sure all the utilities are turned on prior
be sure they know they are gonna be on the roof, in the attic, under the house and in the damn septic system if that what it takes, to get full inspecition

be sure to check the toilets, shower drains, kitchen sinks, disposals and diswasher drains, garage drains, bathroom drains for CONCRETE or LYE

look for suprises left in closets and access points

have the roof checked by a PRO roofer as well with an estimate for damage repair...

be sure Lot lines are cleary marked and fences are where they are supposed to be

be sure the neighborhood is somewhere you want to be for 5 10 20 years..bring a few meals and a bottle to piss in, be there saturday morning and sunday afternoon, and after school and after work a few days,,be sure it is what you want..
the sale is generally as is where is so be sure you have full knowledge of everything before you agree to buy,,

BUY A H.O.W,,,and use it..instal new locks the day you close

CHEF (have bought 5 such houses)
Link Posted: 11/2/2009 8:55:03 AM EST
Just get a world-class pre-purchase inspection. I don't mean the one your bank performs - I mean one of your own.
Link Posted: 11/2/2009 8:56:15 AM EST
Helped buddy do rehab and repairs on a home he bought for his family.
Appraised at $310,000
Purchased for $200,000
Put $80,000 back into it.
The $80K inlcuded contractor's work, material only on work that he and I did

Required new flooring in the entire first floor
Required new furnace, H2O heater, ducts, pipes - former owner broke in after getting pushed and took sledge to furnace and H2O heater
Required new paint with some drywall repair - sledge hammer damage. Some walls just needed new paint
window treatments
long list

Get a look at the house on the inside and take someone knowledgable in repairs and what they will cost
Also get the place secured as soon as possible
As k questions on the process - some foreclosures/short sales take longer becasue of the bank
Link Posted: 11/2/2009 8:58:05 AM EST
Get a FULL title report.

Tax liens, bank liens, judgment liens, the whole nine yards.

You do NOT want to be surprised.
Link Posted: 11/2/2009 9:07:43 AM EST
Not exactly the same thing, but I attempted to buy a short sale earlier this year and my general observation is that banks are a pain in the ass to deal with. Ended up wasting a few hundred on an inspection to be strung on for several months (in which rates went up .50 %) only to have the deal the seller's realtor insisted he'd already negotiated with the bank turned down by them. A private seller has much more invested in the deal and as such, will give you as the buyer much more attention. To a bank, you are just another number for yet another property they have on the books.
Link Posted: 11/2/2009 9:14:42 AM EST
Buy an owner's policy of title insurance (also called a fee policy).
Link Posted: 11/2/2009 9:16:26 AM EST
Are you getting title insurance?

If not, why not?
Link Posted: 11/2/2009 9:26:14 AM EST
[Last Edit: 11/2/2009 9:27:43 AM EST by M4Real]
Just be careful of the pit, you might fall in it. Seriously, some houses can be money pits.
Link Posted: 11/2/2009 9:27:59 AM EST
i would make sure there's no dead bodies hidden in the walls.
Link Posted: 11/2/2009 9:29:55 AM EST
[Last Edit: 11/2/2009 9:31:33 AM EST by Aimless]
Link Posted: 11/2/2009 9:37:47 AM EST
Originally Posted By magnum_99:
Get a FULL title report.

Tax liens, bank liens, judgment liens, the whole nine yards.

You do NOT want to be surprised.


definetly this, a friend of mine got stung on one of these deals (10k second morgage)
Link Posted: 11/2/2009 9:40:48 AM EST
I am taking it all in, keep er comin fellas :) i am at the very beginning of being interested in one so i am doing a ton of reading and learning... we are going to do a walk through tomorrow night
Link Posted: 11/2/2009 9:44:57 AM EST


My wife is a Realtor and has done a number of short sales now.

The Bank will be the biggest pain in the ass. Plan on calling them daily to keep them moving.

Link Posted: 11/2/2009 9:48:57 AM EST
Expect to completely redo everything, and beware of Chinese drywall syndrome (black mold).
Link Posted: 11/2/2009 9:50:15 AM EST
Originally Posted By magnum_99:
Get a FULL title report.

Tax liens, bank liens, judgment liens, the whole nine yards.

You do NOT want to be surprised.


This!
Link Posted: 11/2/2009 9:52:09 AM EST
[Last Edit: 11/2/2009 9:57:23 AM EST by levigarrett93]
I have bought at least 30 in my time... They are sold as is where is.... Do your homework on the property ie: knowing if permits have been pulled is a great start. Know what default amount was... make sure the you understand that banks move at there speed and you may have to be patient...
Good luck
Link Posted: 11/2/2009 9:52:29 AM EST
Figure out what insurance and utilities might cost you. Insurance companies charge a lot more for houses that are unoccupied –– they're afraid it'll get squatters or that you'll torch it because it's a pain.

Does it have a HOA? Are there any special assessments coming up? It really sucks to have an extra monthly payment or to suddenly have a big bill come due that you didn't plan for. Does the HOA have restrictions on renting it? On how you can go about repairing? Do they forbid "for sale" signs?

Are there any hazmat issues? In my state, if a house has been a meth lab, you're required to have a licensed meth lab remediation contractor clean it and sign off. For some time, there were NO licensed meth lab remediation contractors, so you'd be screwed.
Link Posted: 11/2/2009 9:56:06 AM EST
I just bought a foreclosure in July.

It was way above average condition compared to the many others we looked at. (virtually move in ready) 5 year old house.

Normally it's going to be "as is".

Get at least a 1 year home warranty including the roof.
Link Posted: 11/2/2009 9:56:59 AM EST

Originally Posted By magnum_99:
Get a FULL title report.

Tax liens, bank liens, judgment liens, the whole nine yards.

You do NOT want to be surprised.

You won't get financed without a title insurance policy. That's what Title Companies do. They insure clear title.

Additionally, I would check the tax appraisal to see that it's in line with the hired appraiser's figures. You don't want to be assessed 200k on a house that will only bring 100k on the market. Everything dropped last year....make sure the tax assesment did too, to reflect the lower market prices. I'd want the minerals under the lot too.

I bought a foreclosure a couple of years ago. Got a great deal. Just don't get too anxious....do your due dilligence. Spending time in the neighborhood is a neccessity. I parked in several places around the neighborhood and just watched what was going on. I spent a few days and nights doing this for a few hours at a time. Be sure you want the house....and watch out for HOA's. Grumpy old fuckers want to tell you how to live.

You can get pre-approved for $ X amount of mortgage lending and then shop in your price bracket. Be sure and get a FIXED Rate mortgage!! Juice is fixin' to go WAY up....think 19 - 24% interest rates.

Good luck!!
Link Posted: 11/2/2009 10:04:28 AM EST
Where do you find out about these things?

Is there a website I can go to to search for forclosures in my area???


Link Posted: 11/2/2009 10:25:46 AM EST
Originally Posted By moharrow:
Originally Posted By magnum_99:
Get a FULL title report.

Tax liens, bank liens, judgment liens, the whole nine yards.

You do NOT want to be surprised.


definetly this, a friend of mine got stung on one of these deals (10k second morgage)


A second mortgage should be void if the proper steps were taken on the first. If you don't get a title report or fee policy you won't know diddly. It would be entirely possible here in ne that yu could purchase a foreclosure of the second and still have the first lien holder out there.

Posted Via AR15.Com Mobile
Link Posted: 11/2/2009 10:31:36 AM EST
Many people sabotage it since they cant have it, no one can. super leftard lesbian couple next door poured concrete down all their drains before they left and smashed out support walls.
Link Posted: 11/2/2009 10:37:40 AM EST
Originally Posted By the_ak_kid:
Where do you find out about these things?

Is there a website I can go to to search for forclosures in my area???




There are websites, but by te time it gets there it is too late.

Read about them in the legal section of the paper. Buy them at the sheriffs or trustee auction, and you get the best deals.

Posted Via AR15.Com Mobile
Link Posted: 11/2/2009 10:42:26 AM EST
You will not get the same kind of title that you would in most transactions. I would check into getting a title insurance policy before the auction. These things usually go OK, but I have heard of some crazy shit when courts get involved.
Link Posted: 11/2/2009 10:44:08 AM EST
tag
Link Posted: 11/2/2009 10:44:46 AM EST
[Last Edit: 11/2/2009 10:48:01 AM EST by brickeyee]
Originally Posted By n0zzle:
Expect to completely redo everything, and beware of Chinese drywall syndrome (black mold).


Chinese Drywall is sulfur contaminated, not mold.

The sulfur is release and eats away at all sorts of things, like plumbing, electrical connections, phone lines, a;ong with being a general irritant to people when they breath it in.


I have don e many over 20+ years, but business has picked up lately.

The banks have a bottom line that is based on PMI and how much they stand to eat when the deal is done.

In typical bank fashion they want to make sure no individual is held responsible for the loss, so they have all sorts of internal committees.

You also need to find out who actually owns the debt.
The bank may just be handling the sale for Freddie, Fannie, or another not holder.

The note holder has the final say.




Link Posted: 11/2/2009 10:49:27 AM EST
Are you talking about buying a house that the bank foreclosed on and already owns, or are you talking about buying a property that is in foreclosure and is being sold at the sheriff's sale?

If its bank owned, then its just like buying a regular house, you go through a realtor, get inspections, etc.

If its at a sheriff's sale, its a whole different story. In Ohio, you have to put down 10% on the day of the auction if you win, then you have 30 days to get your financing. Generally speaking, you dont have access to the house at all, unless you break in or know someone who will let you in. Sometimes the owners will still be living in the house and you might have to evict them.

Really without answering my first question, its impossible to give you any good advice.
Link Posted: 11/2/2009 10:53:23 AM EST
Originally Posted By the_ak_kid:
Where do you find out about these things?

Is there a website I can go to to search for forclosures in my area???




not sure how its done in texas, but in Ohio, all foreclosures are sold at sheriff's sales. To get a list of properties you just go online to your county sheriff's website and look for "civil sales"

For example, Here is a link to the Franklin County sheriff website, which is for columbus ohio. If you go there and look on the left side of the page, you will see a link for "civil real estate sales" Click on that and you can search all the houses that are going to be sold.

Obviously the rules are different in every state, but maybe its similar in Texas. I am not sure though.
Link Posted: 11/2/2009 10:55:42 AM EST
Everyone else has posted all of the great advice. I only have one anecdote to add... hopefully to make you laugh. I bought a large foreclosed house in 2001. Followed all the advice (I thought) but was not prepared for this little glorious surprise on my second night sleeping there: septic system backed up and toilet overflowed. There I was standing there watching it speechless, as massive volumes of sewage went BACKWARD and filled the bathroom then seeped out over the bathroom threshold and into the CARPETED next room (the living room / den). I kept shouting at the two cats to run away and hide so the seeping wouldn't get them too but hearing my voice made them run toward me instead of away (the little LEOs they are) so then I was slipping and sliding on the nastiness while trying to pick up both cats... Oh it was a glorious scene! And that was what led me to replacing the entire toilet and also buying the longest toilet-snake I had ever seen.

(I have no regrets - it was an awesome memory and everything turned out fine. Plus I sold that home several years ago.)
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