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How hard is it to buy a home in foreclosure or auction?

Several listings in California area we are looking at are in foreclosure? Is there a special procedure or agent we need to talk to?
  • October 17 2013 - San Ramon
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Answers (3)

Best Answer

You can't purchase a home in foreclosure unless you are willing to pay enough tocover all of the sellers debt on the property in order to release the liens and satisfy title.

In some cases, you can purchase a home that is in foreclosure but the seller is asking the bank to accept a short payoff otherwise known as a Short-Sale.  No guarantees, and you need lots of patience, along with  flexibility on time and price.

Purchasing a Bank REO (property that has been foreclosed on) is a bit easier.  it's alreacy valued by the seller and all subordinate liens have been satisfied or extinguished.

Purchasing at the Foreclosure Auction (in between when the owner lost the property and the bank buys it back) there is a window of opportunity. As mentioned in previous post, this requires a lot of knowledge, and cash. You may end up purchasing a property for a low amount only to be hit with federal liens, tax liens, and municipal liens that do not go away as sale.

Hope this helps.

  • October 17 2013
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People use the incorrect terms a lot so I am not sure to you what "In Foreclosure" means. If it is actually in the process of being foreclosed you can only buy it from the owner and they probably can't sell it in time or you won't pay enough to buy it which requires you pay enough to pay off the loan in full. So it will be darn tough. To buy at the foreclosure auction you will have to outbid the bank who usually bids what is already owed, and again that is likely more than you would want to pay. Auctions require cash too and you buy all liens also on the property. So I suggest you wait until the bank buys it, values it and lists it for sale with a Realtor.
  • October 17 2013
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No harder than anything else.  Patience is required
  • October 17 2013
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