Profile picture for teresa0502

when buying a foreclosure, do you still have to have a substantial downpayment?

  • July 12 2013 - Eureka
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Answers (3)

Profile picture for CallTheSisters
If the foreclosure needs essential repairs you may not be able to finance it at all.  It would have to be cash.
  • July 13 2013
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Buying a foreclosed/bank owned home is like purchasing any other home with regards to the financing. It depends on whether you are going to purchase the home with an FHA loan (3.5% down), or a conventional loan (10-20% down). I was advise you to speak with a lender. They will be able to give you your options. Also, you will want to have the prequalification letter ready just in case you do find a property that you would like to purchase.
  • July 13 2013
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If you buy a foreclosure, then it will be at the public auction which does not allow loans and requires cash.

More than likely you are talking about a property that went through foreclosure in the past and it no longer correctly called a foreclosure since it is no longer in foreclosure. Someone bought it at the auction and likely the bank that had the loan on it. Now it is bank owned or a REO property. You can buy them once they are listed with a Realtor for sale just like any other home for sale. It depends on what type of loan you get that determines the min down payment.

Go see a loan officer or mortgage broker to actually find out what you can borrow, they will explain this to you.

tim
  • July 13 2013
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