Long story short, I'm looking at a foreclosed home. In the last 6 months the price has dropped from cheap, to almost 50% lower into "why hasn't anyone bought it yet territory". The lot is easily worth more than what they are asking for the lot with a house. I did a walk through and while it is very dirty and dated and needs repairs, I've worked as a carpenter and GC for 10 years,and i'm not scared by anything I see. It needs alot of work, but the price justifies it. I know nothing about buying real estate. My plan is to live in the home, and remodel it over a period of time. It would be a great location to live.

My question, with the house being so cheap, and being repeatedly discounted, i feel there must be something horribly wrong with it. Besides a home inspection, what can i do to cover my ass from some unforseable circumstance, like missing septic system or a huge lien on it, or dead bodies buried in the basement, or flood boards infected with the ebola virus?  For example, i'm starting to wonder if it shares a well with the neighbors. I know the last sale was for almost 4x the asking price, and home prices havent fallen anywhere near that bad around here.

Any advice is appreciated. Any tips for contract specific knowledge especially. Thanks.
BTW Fuck Obama.

ETA more info and a response to advice:

As far as the lot being a value, it is, but i cannot afford a complete teardown and rebuild right now.

I'm not looking for a short term investment, This is an area i can envision myself living in for the next ten years at least. I thinkthe house is priced right about what it would have sold for in about 96 or 97, as it is very similar to one a family member bought back then, nearby, but this is in a better area. I agree about speculation driving up the price of home, but i'm pretty sure they stopped making vacant land a while back.


First order of business is to lowball, and talk to the neighbors
2nd step is to get the home inspection
3rd I'm going through a realtor, different from the listing agent, do i need to hire a lawyer additionally?


I tend to have trouble dealing with the county, ask three people and get three answers, th e answers today will be different tomorrow. What kind of info am i looking for? Tax records, septic plats, zoning plats ect?

If the property alone is worth more than the asking price you can't go wrong IMO.

Got cash?  That sweetens the deal.

Get a good inspector and real estate lawyer to check it out, then snap it up.

Quoted: Get a good inspector and real estate lawyer to check it out, then snap it up.

This

people want houses they can just move into, maybe carpet and paint.  theres deals to be had if you are willing to work.

I would talk to some neighbors...it costs nothing and can be a HUGE source of info. As for a possible lien, your closing attorney (or the seller's closing attorney depending on what the seller mandates) will perform a title search and there should also be standard language in the contract that states there are no known pending assessments.

If you're a GC, you already KNOW about 95% of what you need to know. I say go for it. Plus, if you live in it for 2 years as your primary residence you can sell it anytime after that and not pay any capital gains tax (assuming 2 years passes before Obama has closed that loophole).

You are right on track.

You'll get roughly 10 days for home inspections, use them. Be ready to spend the $600 on the home inspection + termite inspection + AC inspection. It's excellent that you have a background as a general contractor, but PLEASE order a home inspection so you have another set of eyes checking things out.

Since you were able to get into the house, you probably have a real estate agent already, but ask your agent to give you some comps on the area.

-Talk to a lender, get your finances in order.
-Use a different agent to represent you than the listing agent for the house you want.
-Get the home inspections done.
-Do your homework county info for the house.
-Knock on the doors of the neighbors. (it's awkward, I know, but you will be blown away by the amount of info you can get from the neighbors)

Other than that.. get an offer in asap if you are interested.

As far as the lot being a value, it is, but i cannot afford a complete teardown and rebuild right now.

I'm not looking for a short term investment, This is an area i can envision myself living in for the next ten years at least. I thinkthe house is priced right about what it would have sold for in about 96 or 97, as it is very similar to one a family member bought back then, nearby, but this is in a better area. I agree about speculation driving up the price of home, but i'm pretty sure they stopped making vacant land a while back.


First order of business is to lowball, and talk to the neighbors
2nd step is to get the home inspection
3rd I'm going through a realtor, different from the listing agent, do i need to hire a lawyer additionally?

Quoted: As far as the lot being a value, it is, but i cannot afford a complete teardown and rebuild right now. I'm not looking for a short term investment, This is an area i can envision myself living in for the next ten years at least. I thinkthe house is priced right about what it would have sold for in about 96 or 97, as it is very similar to one a family member bought back then, nearby, but this is in a better area. I agree about speculation driving up the price of home, but i'm pretty sure they stopped making vacant land a while back. First order of business is to lowball, and talk to the neighbors 2nd step is to get the home inspection 3rd I'm going through a realtor, different from the listing agent, do i need to hire a lawyer additionally?

Yes. BUT you may have to use the seller's (the bank that owns the property) approved closing agent/attorney. With foreclosures, it depends on the the bank that is selling. They often hire out their real estate sales to third parties that actually know what the hell they are doing (banks are not in the RE sales business). Usually, the bank has a RE attorney that they require any buyers to also use to close. It's not a big deal since any attorney can do a title search on your behalf, close the transaction for you and record the deed (for a fee, of course).
That's one thing that takes these foreclosures longer to sell/close - the buyer (you) has to compy with the bank's rinky dink bureaucracy. The reward for you is that you usually get the property below market value. Talk to your agent - they will be able to tell you definitively.