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Tiam
3-27-12, 10:30pm
I'm coming into a very small inheritance and buying a home straight out, probably a manufactured home would be my best option at this point. But I don't know where to start?

fidgiegirl
3-27-12, 10:56pm
I think you can get them on auctions and whatnot, but at some point many are just coming on the regular market. That's how we got ours. I have heard in some markets that investors with cash beat out financing, especially if they are priced to move, so you might be well-situated.

Congratulations!

Tiam
3-27-12, 11:30pm
I think you can get them on auctions and whatnot, but at some point many are just coming on the regular market. That's how we got ours. I have heard in some markets that investors with cash beat out financing, especially if they are priced to move, so you might be well-situated.

Congratulations!

When you say, "on the regular market" what does that mean?

catherine
3-27-12, 11:44pm
There are websites that specialize in foreclosed houses: one is called RealtyTrak (I think that's how you spell it).

I bought the house next door that went to foreclosure. We found out our neighbor was having difficulties, so we gave him an offer, which he refused. Not sure why.. because eventually he had to walk away and the bank took it over. They then brought in cleaning crews and just basically cleaned it--no cosmetic work at all. It was pretty run-down on the inside, but we wanted my MIL/BIL to live there.

Next thing was, the bank put it on the market--for a really low price (FAR lower than what our original offer to the owner was). Of course, the people started coming around in droves (since we live next door, we were keeping an eye out, nervously. They were just looking for a good deal--I was looking for a home for my relatives).

The bank then gave instructions that they were asking for a sealed bid from interested parties, meaning we had no idea what other people were offering, and we knew they were probably bidding over the asking price. The real estate agent said we would be in a more favorable position in the bank's eyes if we could offer cash, so we took out a big mortgage on my MIL's paid off original home.

When trying to figure out what to bid, our agent told us to bid what it's worth to us--not to think about what other people might be bidding. Good advice. We placed a bid--and won. (In a way we won. What we lost was a lot of money because we still have been unable to sell her original house--the housing bubble crashed just a couple of months after we bought the house.)

sweetana3
3-28-12, 7:18am
Tiam, if you have not bought and sold before and are not familiar with the market, try not to go in alone without experienced help. It is a crazy place now and it is more so by all the housing issues that did not exist before.

Often foreclosures are sold "as is" and come with no helpful warranties or many protections for a home buyer. You need to know what you are doing to avoid getting a "bad" product. I am not saying avoid the market but make sure you have a qualified person helping you with the whole issue.

Tiam
3-28-12, 12:12pm
Tiam, if you have not bought and sold before and are not familiar with the market, try not to go in alone without experienced help. It is a crazy place now and it is more so by all the housing issues that did not exist before.

Often foreclosures are sold "as is" and come with no helpful warranties or many protections for a home buyer. You need to know what you are doing to avoid getting a "bad" product. I am not saying avoid the market but make sure you have a qualified person helping you with the whole issue.


thanks, and I agree, and that's why I ask; I just don't know a qualified person. My knowledge is that real estate agents aren't too interested in foreclosure sales.

sweetana3
3-28-12, 12:35pm
Right now I would not focus on just foreclosure sales. There are people trying to do short sales to get out of heavy mortgage burdens, people selling to move or in financial difficulty, etc. Foreclosures are not necessarily the best or cheapest option.

And there are very hungry agents out there selling everything they can find. The down market hurt them and there are a lot that cannot afford to be picky about what they sell. You should consider a buyer's agent to help you and give you the best advice for your area.

jennipurrr
3-28-12, 1:30pm
I would definitely become much more aware of how foreclosures work in your state before pursing anything. I would start with google and go from there, see if there are any books you can read.

I have purchased two foreclosed properties...one at the courthouse steps during the foreclosure proceedings and one after that...often now the mortgage balances are so high that no one except the bank (who is required to bid the mortgage balance, I believe) purchases the home. These homes are then listed through the traditional MLS as "bank owned" or REO homes. Buying a foreclosure at the courthouse is pretty much sight unseen and full of many legal risks that you need to be aware of before proceeding.

Another issue is that you may be interested in a manufactured home. In my state unless these were sold with the land as part of the mortgage, they are not foreclosed on as real estate, but instead "repoed" like cars. From what I hear there can be some great bargains on repoed manufactured homes. There are some auction houses here that sell them on a regular basis. Obviously you would want do your homework regarding condition and inspection, etc. Buying a new manufactured home is usually a horrendous decision financially speaking as the value depreciates even worse than a car. You might want to check out other avenues for buying one used like craigslist.

poetry_writer
3-28-12, 3:02pm
Glad you asked this question. I found a foreclosed piece of property with two small homes on it. I cant figure out how find info on it! The listed realtor says "we aint handling it". A very nice realtor in the area of the home said she didnt have any info on it but would try to check. Its junky but in a beautiful area.

freedomseeker
7-7-12, 11:52am
I can't speak to forelcosure homes specifically but we did look at a few REO properties when we purchased a year and a half ago. We went with a short sale (totally would never ever recommend it) because we liked the location/neighborhood.

In retrospect we were misinformed and it cost us at signing and has cost us since. You will get no assistance with closing, no assistance with anything called on inspection so be prepared to shell out extra cash for potentials. We got ours for below apprasial buy it ended up needing some expensive repairs. This house has had 6 owners since 1997 three in the last 6 years. Lots of deferred maintenance.

Just be careful, spend time researching online auctions and learn as much as you can about pros/cons. Find an inspector you trust and go over the house if you get a chance to preview before auction. As is is always as is- it has cost us an extra 30k. (recalled siding, roof, exterior repairs/paint.)

Good luck, learn and investigate all you can! You can find some bargain properties.

SteveinMN
7-7-12, 1:12pm
Foreclosures and shorts can look like really good deals, but anyone looking to get into home ownership on the cheap needs to know that these houses typically come with red warning flags:

- If there wasn't money for the mortgage payment, there likely wasn't money for maintenance or proper repair. Especially for former rental property and homes which have been "flipped" a few times, find out as much as you can about what condition the house and grounds are in.
- Unless you know someone who does this professionaly (not Uncle John who's "handy around the house"), be prepared to hire a house inspector on spec -- and be prepared to move on if he/she discovers anything you don't have the money/skill/both to fix. Typically, discovery of major problems will not let you amend or retract an offer.
- Be as unencumbered as you can in offering -- no contingent sale of your own property, pre-approved (not just pre-qualified), cash if you can swing it, and no timetable. People may poke fun at the glacial pace of government bureaucracy -- the government is a relative Saturn rocket compared to some overburdened understaffed lender half a country away.
- Unless you don't care that the place holds its value, look for warning signs like bad floor layouts, poor-quality remodels or additions, missing elements (like backyards and garages), and houses atypical for your area (the one-bedroom/one-den in a neighborhood full of families and 3-4 bedroom houses).

There are deals out there, but as people become more confident in what's happening in the economy, good properties at lower price points are seeing multiple bids. It's no longer the languid months of 2008-2009, when you had lots of time to think about a property. If it's a good one at the right price, it won't be on the market for long, foreclosure/short or regular sale.

greenmimama
8-20-12, 4:38pm
It probably depends on your area, we are in MI and they are listed here on the regular MLS sites, it isn't always obvious, but you can kind of tell once you get to know your market.

We purchased one and the only difference was, we were in a multiple offer situation and we were making offers straight to the bank, instead of a homeowner.

It worked out well for us we got a sweet deal, but had to do a ton of work on it,the previous owners took everything out, I mean kitchen cabinets, toilets, doorknobs, jacuzzi tub, light fixtures, landscaping rocks, just almost everything.

Gregg
8-20-12, 5:51pm
Fannie Mae is generally a pain to deal with, but still could be worth it. They have a site that lists their forclosure properties in specific search areas so you can see what's there. They usually sell the properties "as is" so unless there is an ongoing threat they could get sued for not dealing with don't bother asking them to fix it in an offer. You just have to do your homework and inspect the properties very closely. The nice thing about them is that they usually have a 30 day period where only owner occupants can bid on foreclosures. After that, if its not sold, it opens up to investors. There are more REOs out there than most people think and Fannie Mae releases them onto the market slowly so they don't flood a market. Like greenmimama we just bought a foreclosure. It was a good deal, but needs a ton of work. That is exactly what we were looking for, but its not for everyone.

Tussiemussies
8-21-12, 6:04am
Just to let you know, if you search on www.realtor.com, the original page you fill out for your search, you have to scroll down and there will be a button for foreclosures. Then when you do your search, only foreclosures will come up as a result. Good luck in finding just the right place!:)

Minz
8-21-12, 1:21pm
I don't know about other states, but in Colorado, if you buy a property at auction, you are not guaranteed a clear title so it's important to have a title company run an O&E report (owners and encumbrance) report. Also, they don't guarentee there is not another lien. Also, in Colorado, once you "win"the auction, you are required to pay with a cashier's check on the spot. Most realtors are not interested in helping folks with this because they get no commission.

Once a property has been foreclosed upon and it is listed with an agent, it is pretty cut and dry process.

I'm a realtor and the focus of my business is to help people avoid foreclosure....there are actually quite a few options people have besides going into foreclosure. I think foreclosure should be a last option...short-sale it is better and banks are more open to doing short sales these days. If anyone has a specific question that I may be able to help with, feel free to send me a message behind the scenes. I love talking Real Estate!

lmerullo
8-21-12, 2:14pm
Minz, what you say about the title search is very true. We bought a foreclosure directly from the mortgage company and the title search turned up six instances for concern, but they insured against claims and our title is "protected" from others making claims / liens against our title.

We went through an offer, counter offer, "best and final offer" situation on our home. We felt a little abused, as the home had been vacant and on the market for years and as soon as we made an offer then tons of investors were also interested since the bank was entertaining our very low-ball offer. We won the bid on our vacation home, but subsequently have lost two other bids on nearby properties. I think once a really low offer is made, the realtors and mortgage companies shop around to their known investors to see if they can get a higher offer, resulting in a higher commission. We actually have a flat rate agreement with our realtor to avoid this scenario - and she knows us well enough to know that we don't waste her time.

Lainey
8-21-12, 9:37pm
I agree with what SteveMN said, except for the part about the one bdrm home in a neighborhood of 3 bdrm homes. That's actually what I did last year when I bought a foreclosure from B of A. I was the highest bidder at $29,000 for a 1 bdrm house in a solid working class neighborhood. Lots of work to be done (bathroom and kitchen are original 1950s) but the property has plenty of back yard for expansion, and the plumbing and electrical and roof are decent.

I have relatives living there now who are paying me rent of $300/mo and they pay their own utilities. Super cheap for them, and the money stays in the family. Would not work for everyone, but the 1 and 2 bdrm places are often overlooked by investors so you have a chance to get something without a ton of bidders.

SteveinMN
8-22-12, 8:14am
the 1 and 2 bdrm places are often overlooked by investors so you have a chance to get something without a ton of bidders.
Very good point, Lainey!

Perhaps a better example on my part would have been an ultra-contemporary home in a neighborhood of 1920s bungalows or 1880 Victorians. There's a buyer for every home, but from a resale perspective, it's good to stay near the neighborhood norm.

Mrs. Hermit
8-22-12, 10:38am
We bought a foreclosure from a realtor. Other than the incredibly long wait for everything the bank had to approve, the process was like just buying any house. We told the realtor upfront that we were only interested in short sale or foreclosed property, and that is all she showed us. She was a great help getting us through all the details of the process, including reaming out our mortgage company's officers when they tried to postpone closing (for the 3rd time) because the mortgage agent was at a golf tournament!

awakenedsoul
8-23-12, 11:22pm
[QUOTE=Lainey;97275]I agree with what SteveMN said, except for the part about the one bdrm home in a neighborhood of 3 bdrm homes. That's actually what I did last year when I bought a foreclosure from B of A. I was the highest bidder at $29,000 for a 1 bdrm house in a solid working class neighborhood. Lots of work to be done (bathroom and kitchen are original 1950s) but the property has plenty of back yard for expansion, and the plumbing and electrical and roof are decent.

That's incredible! What a great story. There are some great deals out there now. My little house also had working plumbing, a fifteen year old roof, and the wiring was fine. My plumber is always shocked at how few problems I have had. He just fixed the 20 year old toilet for me. He's really nice about repairing things instead of replacing them. He's old school. He always marvels that this home still has the original pipes. It's a well built cottage. The paperwork says it was built in 1944, but I think it's one of the beach houses they brought up from Malibu. It has the exact same kitchen cabinets that my neighbor's house has, and hers was built in the 1920's. I take very good care of it, and I think that makes a difference, too.

iris lily
8-24-12, 1:51am
...That's incredible! What a great story. There are some great deals out there now. My little house also had working plumbing, a fifteen year old roof, and the wiring was fine. My plumber is always shocked at how few problems I have had. He just fixed the 20 year old toilet for me. He's really nice about repairing things instead of replacing them. He's old school. He always marvels that this home still has the original pipes. It's a well built cottage. The paperwork says it was built in 1944, but I think it's one of the beach houses they brought up from Malibu. It has the exact same kitchen cabinets that my neighbor's house has, and hers was built in the 1920's. I take very good care of it, and I think that makes a difference, too.

You know, we really like cottages on this board. You will have to post photos! We love them liddle bitty houses! I want to see your kitchen cabinets. We had a thread a few months ago about old kitchens. I was going through a phase of obsession with old kitchen cabinets.

Tonight I was talking to a friend who has moved back to the city, and she has original metal cabinets in her old house. I want to see those, too!

sweetana3
8-24-12, 7:57am
It is funny how words are used. In the UK, a cottage can be a truly huge house. Never figured out the difference but it was seldomly a tiny house.

Jill
9-23-12, 1:15am
I would strongly suggest seeing a real estate lawyer before getting involved in the purchase of a foreclosure. The process can be incredibly complex depending on what state you're in, and there are so many details that differ depending on the individual situation of each buyer and each home. I met with a lawyer about six months ago when I needed to dispose of some property and it was so helpful. It's expensive - the guy I went to charged $325 per hour (!) but he seriously saved me about $30,000 by setting me straight on a big mistake I almost made. I know you're looking to buy rather than sell, but there are so many things. For example, what happens if there are renters in the house you want to buy? What happens if the renters destroy it or refuse to leave after you buy it? What if there are liens? What if there are HOA delinquencies? What if there are taxes owed? What if there were additions or other work done without permits? Do you have the right to an inspection period in your state? And a million more questions that could possibly come up. I don't mean to sound negative but I'd hate to see someone jump into something like this without all the information they need, like I almost did. I guess in some states buying a foreclosure is just like buying any other property, but it's not true everywhere so just try to be as informed as you possibly can.

ToomuchStuff
9-23-12, 2:34am
I would strongly suggest seeing a real estate lawyer before getting involved in the purchase of a foreclosure. The process can be incredibly complex depending on what state you're in, and there are so many details that differ depending on the individual situation of each buyer and each home. I met with a lawyer about six months ago when I needed to dispose of some property and it was so helpful. It's expensive - the guy I went to charged $325 per hour (!) but he seriously saved me about $30,000 by setting me straight on a big mistake I almost made. I know you're looking to buy rather than sell, but there are so many things. For example, what happens if there are renters in the house you want to buy? What happens if the renters destroy it or refuse to leave after you buy it? What if there are liens? What if there are HOA delinquencies? What if there are taxes owed? What if there were additions or other work done without permits? Do you have the right to an inspection period in your state? And a million more questions that could possibly come up. I don't mean to sound negative but I'd hate to see someone jump into something like this without all the information they need, like I almost did. I guess in some states buying a foreclosure is just like buying any other property, but it's not true everywhere so just try to be as informed as you possibly can.


Hopefully six months later isn't too late for this advice, for the original poster.

KevinOKane
8-31-13, 5:57am
We typically have a lot of requests for plumbing for foreclosed homes since it requires more maintenance. SteveinMN nails all the points of what needs to be done when it comes to buying a foreclosed home. There was once that we almost did not have enough water and gas plumbers to cover the demands for the week, when there were a number of foreclosures and a frenzy of people buying such.

rodeosweetheart
9-2-13, 10:08pm
+3 to Steve, Awakened, and Lainey. Great advice there.
We bought our last 2 houses as foreclosure properties. As in your market, lots of manufactured homes available in both states where we bought. We held out for stick built, although I would had bought a manufactured if it was a wonderful property--we are more property oriented than house. but I really wanted a stick built, as they are easier to insure and hold value much better--also we like old houses.

We found second home on Hud.gov. Also used the Fannie Mae and Freddie Mac sites. Tehy are all free. But all the houses were also on Realtor.com, so maybe start there.

As much as you can, get really familiar with your market. I think that is most important, to get a feel for values in your area. So area-specific. We had a lot of things we really wanted and with first house, found it and bought ia week later, closed two weeks later. It's been a great little house, although like with Lainey;s, they took everything, including furnance and kitchen counters and sink. We will probably break even on what we put in but we have lived here 3 years and it has been fantastic mostly because of the fenced 3/4 acres--we love our dogs--they are the reason we keep not renting. Nice little house, soilid and well built, will list it later this week.

The second one we just bought--someone bought it off HUD and his plans changed for flipping it, he decided it was too much work. The house needs a whole lotta work but it has some wonderful old house points. It was a bargain for us--house and two barns and 5 acres in a beautiful part of the country. Not sure if it will be our last house, but we really like buying "non-retail" houses. PM me if you have any questions I can help with! I love looking at house ads and maybe I will be able to come up with questions to ask your agent.

Gardenarian
9-3-13, 4:59pm
My cabin was a foreclosure, but I found it through realtor.com. Most foreclosures are listed there - they rarely go straight to auction.
The bank (BofA) who was selling made a lot of difficulties for us in purchasing, but it was definitely worth pursuing - what a deal we got. Bought at about half the market price, when market prices had hit bottom.

ToomuchStuff
9-5-13, 6:08pm
And still no one looks at dates.

Maybe I should invent something called, a calendar.>8)

Gardenarian
9-6-13, 3:02pm
And still no one looks at dates.

Maybe I should invent something called, a calendar.>8)

What?

reader99
9-6-13, 4:57pm
And still no one looks at dates.

Maybe I should invent something called, a calendar.>8)

Even if the info is too late for the OP, these threads stay online for years and someone else with the same question may benefit from the full discussion.

try2bfrugal
9-6-13, 6:15pm
I am intrigued with the buying a foreclosure idea so I am happy whenever any one has some words of wisdom to add.

KayEhm
11-24-14, 10:47pm
Well I think the best place to start is by looking up your prospective foreclosure property sales (http://www.oregonsheriffs.com/sheriffs-sales.htm). All of this data can be found online, depending on your state (I'm from Oregon, so I linked the site I know of for my state.. if that's not where you're from you can at least get an idea from that for what you're looking for). Get an idea of what the time-frame is for each possibility, the price-range, and the condition of the property based on that criteria. Research, research, research. You're the only one who knows your limits so judge accordingly. It's not that hard once you have all the data - you just have to be willing to pour through it all.

Gardenarian
11-25-14, 4:56pm
The key to investing in property is location and price. Foreclosures will not necessarily sell for less than others, and there are dangers in buying foreclosures. Often you have to purchase the property "as-is", without being able to do the proper inspections. Angry owners who have been kicked out often damage the property - and maybe not in the most obvious ways.

The best thing is to just keep an eye on the neighborhood you're interested in, and remember that the asking price is just a suggestion.

awakenedsoul
11-25-14, 10:21pm
I am intrigued with the buying a foreclosure idea so I am happy whenever any one has some words of wisdom to add.

I'm enjoying this thread, too. (for the most part...)

Blackdog Lin
11-25-14, 10:28pm
I enjoy the idea of having an alternate income stream, having rental properties etc. I've just never been ever to get over my Granny (who kind of raised me, and whom I adored) saying over and over "never be a landlord!". She hated the hassle, and I guess never really made a good profit of it. This would have been in the 50's and 60's. She was still saying this to me in the 70's and 80's.

So I didn't. And it certainly helps keep my life "simple".

Teacher Terry
11-26-14, 2:56pm
The home we live in now was a foreclosure. The bank hired a realtor & put it on the market. We got it for about half of what it was worth. The bank just got to the point that they wanted it gone. They lowered the price a lot & gave everyone 24 hours to put in one bid. YOu had to have all cash & no inspection. Since my hubby is a civil engineer he did the inspection himself. In the end we beat out 6 other people by offering $8000 over asking.