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Now that I have info on forclosed homes. How do I buy one. Who do I call ? The Bank?

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May 26 2009 - Bay Area
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Hi Scrillz,

By foreclosed you mean Banked Owned REO? If so, you need to make sure your ready to shoot from the hip when making an offer. REO listed properties want you to provide you loan approval letter with the offer. Also banks control the deal unless you pay closing costs(ie title and escrow).

I strongly recommend working with a experienced agent or a real estate attorney at the least if you're going at it alone.

Have you heard of HUD properties for sale? They have programs where you can put $100 down and have HUD credit you $2000 for corrective repairs associated when purchasing the home.

Hope this helps, take care!
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May 26 2009
Banks like to see multiple offers before agreeing to accept an offer.   They have to see at least three broker price opinions for them to determine fair market value. 

If you are thinking about buying a REO property they tend to need repair, FHA's 203(K) rehabilitation loan or it's simplified alternative, the Streamlined(k) may be a good option for you. FHA's simplified Streamlined(k) program for small-scale repairs is the perfect option for most HUD REO sales. For the major repairs&more complicated renovation plans, the Standard 203(K) program is the option. HUD Homes, like the majority of property re-sales, require some level of repair. FHA's Streamlined (k) program allows the buyer to finance both the purchase and the cost of minor repairs and/or upgrades through a single mortgage. While there is no cap on repairs for the Standard203(K), the Streamlined (k) allows for repairs from $1 up to $35,000. For the Streamlined(k) option, home buyers identify their repair needs,which may include: new carpet; interior and exterior paint; new appliances; kitchen or bathroom remodel; exterior landscaping and other minor improvements.

A REALTOR or FHA approved lender will be able to answer specific questions about the Standard and Streamlined 203(K) loan program.
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May 28 2009
The bank may entertain an offer but most likely they will ask you to wait until it is being marketed. If it is priced right you may have competition, so be prepared. have your financing in place and a pre approval from a reputable lender. Some sellers want buyers to prequalify with their lender.
If the property has not been assigned to a broker you may be able to attract the bank with a decent all cash offer. closing in 15 days. Decent may be as little as 80% of what was owed to them. Certainly 5% below current market value would likely get their attention, especially if commissions and cost to market were eliminated. Good Luck!
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May 27 2009
The type of foreclosure is solely determined by who the holder of the mortgage is. Most mortgages are sold in the secondary mortgage market to the following entities. Fanniemae, FreddieMac (conventional loans). Ginniemae (Fha,VA,USDA) or wall street direct such as Lehman, Bear Stearns (alt -a and subprime). Also many loans have PMI insurance if the loan was greater than 80% LTV. (PMI,UG,MGIC,RMIC). Govt loans have MIP or funding fees. Depending on the loan and any PMI will determine the methodology of Resale. An examaple is an FHA insured loan will be sold as an HUD resale at www.HUD.gov thru a state or regional management compay. Florida, Ohio, PR, VI www.nhmsi.com. FannieMae at FannieMae.com and etc...

Best advice is to find a real estate agent that has experience in selling REO properties. Most foreclosures require REALTORS to be involved and do not allow the public to go direct to the source.

The best type of foreclosure for you is going to be determined solely on your financial qualifications. Different foreclosure properties have different financing requirements that require significant downpayment requirements from as little as zero down to 20-30% down to all cash. Credit score and occupancy also can make a differance on the type of REO property you should, or should not be looking at.

I would contact a lender that understands foreclosures. My Gal is Debbie Myers at Platinum Community Bank. 1-8-777-Debbie (1-877-733-2243) dmyers@platinumbank.net
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May 27 2009
You'll probably need a Real Estate Agent to show you the property.  If you want to present an offer, you'll need a Proof of Funds document.  If the property needs a lot of work they like No Inspections and Cash Offers.
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May 27 2009
Scrillz-

First things first, all REO property listings want an offer to have the loan approval letter attached to it. Banks could be the most motivated sellers but they want you to be ready to shoot from the hip. Banks usually have most of the control on the deal unless you pay for the title insurance and escrow fee's.

I recommend an experienced agent or a real estate attorney at the least.

Also HUD properties have a great program where They'll accept $100 down (if your FHA insured) and provide you with money at closing (normally $2,ooo) for a slight costs of the corrective repairs.

Hope this helps you move forward. Take Care!
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May 26 2009
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1st read this link
http://www.bloomberg.com/apps/news?pid=20603037&sid=aJjnVOs7SUW8&refer=home

date may 26   title  Home Prices in 20 U.S. Cities Fall More Than Forecast (Update2

also I think you will find that the midnight adds on tv telling you how to make a fortune buying foreclosures is all bunk... it use to work as a way to earn a living but now the reason a house is in foreclosure is because a person can not sell the house for more than is owed..The bubble has burst. And you will not buy it at an auction for less than is owed. the mortgage owner/servicer will have to buy back the house for the amount of the mortgage. it then becomes and REO and the bank puts it up for sale.  The banks do know the market (somewhat) and are not giving the REO houses away. They just start too high and then lower the price until it sells and may take a year to do so.   And if you are not learning the foreclosure business from a person who has done this for a living for a long time you can loose a lot of money learning. there are a 100 ways to loose a lot of money buying at a foreclosure auction, the main one is because you will have to pay at least more than the bank is owed, which will be above present market value which is why the owner who lost it did not sell it .  Even if you buy a million $ house for 1$ there can be 2 million of leans against the house that you as the new owner of the title will have to clear, that 1$ house just cost 2 million.  Do you know how to be sure there are not  2 miilion of liens against the house you are bidding on at the foreclosure auction. when you buy at the foreclosure auction you buy the deed as is and you get no garrantee of a clear title.  I use to go to the foreclosure auctions everyday ( my learning process) and in the last year even the groups of people who buy to flip forcelosures or keep them as rentals are not buying much any more. the area is S. Cal  but those adds running at midnight on the tv telling about the big money in foreclosures must be right. I am not sure why the guy talking is not making money on foreclosures and moving to some tropical island but who am i to question the wisdom of midnight tv adds.
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May 26 2009
 
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