Purchasing A Foreclosure Home
Dallas Mortgage Lender FAQ
Purchasing a Foreclosure
How do you purchase a foreclosure?
The two most common ways to purchase a foreclosure are through a public auction or real estate agent.
What is the difference between a regular real estate transaction and the purchase of a foreclosure property?
One difference between a regular real estate transaction and the purchase of a foreclosure is negotiating the purchase price. Due to the several levels of approval required to close the transaction, the negotiation process for a foreclosure property will generally take a little longer than a regular real estate transaction. The process begins with the bank approving your offer. In some instances, the investor may own the property and will have to give approval as well.
One important thing to note is pricing for foreclosures is usually set at market value in order to sell the property quickly; therefore, it can be a good idea to submit a fair and reasonable offer, as most banks will originally list properties at a fair price.
Where can I find foreclosure homes for sale?
Many foreclosures are listed for sale the same way as traditional homes. In addition to searching the usual resources such as newspapers and online real estate listings and websites, you can visit the U.S. Department of Housing and Urban Development website for a list of several Federal agencies selling foreclosure homes.
Auctions are another great way to access and purchase foreclosures. The two types of auctions to look for are a public foreclosure auction and a public auction through an auction company.
Should I get the property inspected?
It is almost always a good idea to have your potential home inspected, but it is even more important to have the potential property inspected if it is a foreclosure. The reason an inspection is extremely important for foreclosures is because the bank has not maintained or had first-hand knowledge of the property before possession of it. If there is no record of property repairs or maintenance then the bank has no way of evaluating the true condition of the property.
What can I learn from a property inspection?
The results from a licensed home inspector’s report will inform you about:
- The current condition of the home
- An estimated cost for repairs
- A fair and reasonable offer amount
- Funding for the purchase
What do I do if the home I want is in need of major repairs?
If you discover that repairs are needed for your foreclosure purchase, ask one of our Dallas mortgage experts about our FHA 203K Renovation Loan Program. With an FHA 203K Full Renovation Mortgage, the borrower can receive just one mortgage loan to finance both the purchase of the home as well as the rehabilitation of the property.
If have any additional questions regarding getting a mortgage for a foreclosure home, please contact a Dallas mortgage expert by filling out the form on the right or calling (512) 524-8077.