buying foreclosed homes

Mrs. Gimpy!

Mrs. Gimpy!

Well-known member
is anyone or has anyone bought a foreclosed home recently in southern california? i am currently in the process of trying to buy one but the market is very competitive. if you have a foreclosed home, did you offer full asking price, under/low balled, or did you offer more and if you did offer more, how much? I am currently having issues getting my offers accepted.

recently i offered full asking price on one property and it was declined. i then found another and am offering $10,000 more than asking price. i have yet to find out how that one is going to pan out.

very frustrated (but in a good and thankful way).
 
If you are looking to do something like "flipping" houses don't EVER offer more than asking price. You instantly lose all your bargaining power. The key to doing something like buying houses for flipping is flood the market with slightly low offers and every once in a while someone will take one. You can't expect to get the first thing you want when you are trying to do something on a budget. Buying houses takes time, especially if you are in a place like socal where there is a very dense population. If you got denied offering full asking price I'm going to guess you are still outside your financial means, or the foreclosure didn't go all the way through due to new mortgage laws, both of which are very common things I've seen happen to friends who are buying houses.

One more thing about bargaining that you may not like to hear, but is unfortunately still true: Your sig says you are married so if you haven't been, bring your husband. Men still have a lot more... projection of power shall we say, in bargaining for high dollar items like cars and houses. It's not the case with everyone you meet but certainly a lot of people are still like that, whether conscious of it or not.
 
dpfisher said:
If you are looking to do something like "flipping" houses don't EVER offer more than asking price.
Click to expand...

AGREED!

Look, foreclosed homes are supposed to be a bargain (that's your goal!). I'm looking to start flipping homes. Here are some pointers I got from an associate who owns 20 homes in Colorado:

1. NEVER pay more than 50% list price for a foreclosed home. So, if the bank is asking $150k, offer NO more than $75k for it. You will prob. get 10% of your low-ball offers accepted. Deal with it.

2. NEVER buy a home that needs more than "lipstick" (paint, light fixtures, landscaping, capet, etc.). If it has structural issues, move on.

3. Be ready to close EXTREMELY quickly. No screwing off w/trying to get a loan, or trying to find a down pmt. Have all your funds ready to rock instantly.

My own advice: Buy a good book on buying and rehabbing foreclosed homes. I will recommend this book (it's EXCELLENT) for beginners: "FLIP: How to Find, Fix, and Sell Houses for Profit" by Rick Villani (Author), Clay Davis (Author), Gary Keller (Foreword)
Paperback: 394 pages
Publisher: McGraw-Hill; 1st edition (December 19, 2006)
Language: English
ISBN-10: 0071486100
ISBN-13: 978-0071486101

Amazon: Invalid Link Removed

More later.
 
My brother and I bought a fc'd house in Nor-cal back in August, the offer we put in was what the bank listed it for and they accepted about a month later. I think this one was the 3rd place we put an offer on. The first one needed a lot of work, so we offered 10k less than they were asking. Didnt get it. The second, we offered list price and didnt get it. So just keep looking, and try to be patient with your quest. Good luck! :)
 
the bank accepted our offer :)

- we are not flipping it (maybe 5+years from now). we plan on using it for rental property.
-we bought really cheap so that i could easily float two mortgages on just my income alone, so we were very "conservative" in how much we wanted to buy.
-i brought my hubby with me during the entire process
-we wanted this one in particular becasue it has the only foreclosed home in that particular area.


so so excited... now we just have to hope we dont fall out of escrow. :(
 
Mrs. Gimpy! said:
the bank accepted our offer :)

- we are not flipping it (maybe 5+years from now). we plan on using it for rental property.
-we bought really cheap so that i could easily float two mortgages on just my income alone, so we were very "conservative" in how much we wanted to buy.
-i brought my hubby with me during the entire process
-we wanted this one in particular becasue it has the only foreclosed home in that particular area.


so so excited... now we just have to hope we dont fall out of escrow. :(
Click to expand...

Congratulations. I plan on looking to buy a house within the next year or two.

Good Luck
 
jon671 said:
Congratulations. I plan on looking to buy a house within the next year or two.

Good Luck
Click to expand...
thanks! im just so excited to be "grown up". now i just need a nice car...lol.

any kind of house that you get, as long as you are smart about it, is going to be an awesome financial decision. the prices and interest rates won't stay this low for much longer. i remember just a few years back, i was thinking that there was no way in heck at those prices i could ever afford a house!

man foreclosures are ugly though (some). the one im in the process of picking up reeks of dog piss and has a pile of dog (hopefully) feces left in one of the rooms. no housewarming parties on day one of closing for me.
 
I had just recently got our house right before all the mortage scandals.. turns out that with all those crazy mortages the market is flooded with forclosed houses but a majority of them arent worth buying because A. the owner over paid for the house( they were stupid) and B. they had a adjustable mortage then went up in 6 months so foreclosed on the house only after a year of payments.. that barely makes a dent on interest of the house let alone the price.. sothere are a ton of "foreclosed" homes but are going to be priced as every other house too.. at least my area was like that

If you plan on living there we had got tons of help from our state (nj) there are alot of programs out there many people dont know about look into fha's website
 
There was vomit and urine in the carpet in the converted garage when we bought ours. Needless to say, that carpet was ripped out the first day.
 
Yes, foreclosed homes can be stellar investments. EXPECT them to be trashed, pissed in, crapped in, holes in walls, stains on the carpet, outdated, neglected, etc. What do you think people are going to do to a home that the bank is going to take from them? These people surely aren't going to keep it ship-shape!

That's why they can be such killer deals. The banks have so many foreclosures on their books they need to get rid of these properties. Banks are not real estate holding firms. They are LENDERS. They have no use for real estate. They want to get rid of them, especially if they're trashed!

And to your fortune, they ARE trashed. Just apply some lipstick and it's as good as new. A lot of people don't want to deal with the dog crap/piss, holes in walls, 1980s flooring, etc. But if you have the money and desire to fix up a place, then buying a trashed foreclosure can yield some excellent ROI.

A good inspection is imperative though. You don't want to purchase a property w/a bad foundation, mold (iffy), or structural issues as these can be EXPENSIVE to fix.

Good luck to everyone :)

BTW, Gimpy, what was the listing price for the home you bought, and how much did you end up paying for it?!
 
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