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I Would Like to Buy a Foreclosure Home - Where Should I Start?

By
Real Estate Agent with Donovan Blatt Realty 01267479

I received this question from a potential buyer recently, and since it comes up more and more often, I thought I would post my response to assist others who may be wondering the same thing.

The first thing to do is get pre-approved, preferably a "desktop" approval from a direct lender (this can be obtained through a mortgage broker or a bank). It will be hard, if not impossible, to get a seller, especially a bank, to take your offer seriously without this.

You ask about foreclosure homes, and many people do not distinguish between the different areas of foreclosure ie. short sale, in foreclosure, bank owned, etc. This can make a difference in how you approach the purchase process. 

The best priced properties are likely to have multiple offers as everyone is looking for a deal when they purchase a home, especially in this market. So, consider looking at the "normal" sales. These are people who also want to sell their home, but if they aren't as well priced as the foreclosure homes, they are not as likely to be receiving swarms of offers.  And, if they have equity, they may consider taking an offer that is less than their asking price.

In addition, they are more likely to make repairs and offer credits than a short sale or bank owned/REO.

When making an offer on a short sale, keep in mind that the bank may take weeks up to 4 weeks or more to respond to your offer, so plan to be patient.

Also, with regards to a bank owned/REO or short sale purchase, you are unlikely to get any repairs or credits from the seller to fix any problems in the property and further, banks give limited if any disclosures about potential problems in the homes. So, it is imperative that you have a home inspection done so that you will be able to make an informed decision about the condition of the property.

If you have any additional questions about foreclosures or would like to search for available homes, click Costa Mesa Real Estate, Newport Beach Real Estate, or Huntington Beach Real Estate or contact me at christine@donovanblatt.com.

 

 

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About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.

Are you upside down in your home? Is it worth less than you owe? Are you concerned about making your mortgage payment? For more information see Options to Foreclosures, understanding short sales or contact me at christine@donovanblatt.com to discuss your options.

If you want to buy a home or to list your property for sale, please click Newport Beach homes, Costa Mesa homes, Huntington Beach homes or Orange County homes.  Click the link if you are interested in buying a home at a courthouse auction sale.

Contact me at christine@donovanblatt.com or 714-319-9751 to learn about her system which will make your buying and selling experience easier.

Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.

Click Orange County homes for sale to view all OC homes for sale.

Comments (4)

Carey Pott
January Financial - Foothill Ranch, CA

A friend of mine expressed interest in buying a foreclosure or short sale home, and I basically told him the same thing you just shared: that it can be a LOT of hassle to try to get a deal through a short sale, and it may be easier to just look at the other homes in the regular market.

Aug 21, 2008 06:33 AM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Carey  - It's so true especially as "regular" sellers become a little more used to the new value of their homes.

Aug 22, 2008 03:49 AM
Mark Organek
And the United States of America - Mesa, AZ
It's not a game, it's your life.

Christine, you make some great points in your post.  It does pay for home buyers looking for "deals" to use the services of an agent such as yourself.  You regularly update Costa Mesa market data and this should save buyers from making the "low-ball" mistake.

Aug 24, 2008 07:00 PM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Mark - Thanks.  I hope that the updates on the market will help people better understand what is truly going on locally as the market is different from one area to the next.

Aug 24, 2008 07:04 PM