Foreclosure homes! How does it work?

Question

I have been looking into buying a foreclosure home but I am a little confused on how it works. Say the home is valued at $200,000 and the owned amount on the home is $50,000. Would I have to pay the $200,000 or the $50,000? I know that I would have to get approved for a loan, get a real estate agent, as well as pay the down payment but I wasn't sure what is the "price" that I would be paying. Thank you all!!

Answer 1

if you find a deal like that PLEASE let me know,

nobody is going to sell you a home that is worth 200,000  for 50,000.

think about it. doesn't add up

Answer 2

Our first home was a foreclosed home. We didn't know when we put an offer for it because it was listed by a real estate agent. The amount you pay for it doesn't necessarily depend how much the loan balance is; it depends on how much the bank is willing to accept. You have a better chance to get the price down because most banks are motivated to sell and in some cases cut their loses or take a loss by selling it for less than what the loan balance is. You could approach a bank to pre-qualify for a loan. You could use a real estate agent to help you locate a foreclosed properties.

Answer 3

You may not pay the full valued price of $200,000, but your chances of buying this house for $50,000 are zero.  The purchasing of foreclosures has been overhyped worse than anything else ever since the foreclosures started a few years back.

There is no magic to buying a foreclosure vs a conventional house, save that the seller is the lender instead of the former owner.  Infomercials hawk that you can buy foreclosures for 'pennies on the dollar'.  Always remember that 99 cents out of a dollar is also 'pennies on the dollar'.

Answer 4

My suggestion to you is to go to your nearest bookstore and purchase a book or two on buying foreclosed homes or distressed properties. There are many there for you to select from

In an attempt to answer your question I take it you are talking about property that has completed the foreclosure process.

If that is the case you will not know what is owed against the property, all you will know is what the asking price of the property is, so you will not have to make a decision as to pay the balanced owed on the mortgage or the asking price.The figure you will be concerned with is the asking price of the property.

These properties have been taken back by the lender and farmed out to real estate brokers for them to sell.

To purchase such a property you will need to get pre approved by a lender after which you may contact any real estate agent in your city that has access to the MLS. This service list all the foreclosures in your area. Some of the agents advertise in the local papers that they have forecosure direct from the bank. You may contact one of them but all the real estate agents have access to them through the MLS.

If you are speaking of trying to buy a pre foreclosure then you will be speaking to the current home owner. This takes a bit of skill you will need to read the books mentioned above to make such a transaction to work.

You will have to come up with a contract, open escrow, find a title company and perhaps get a loan or take over the existing loan the current owner has.      

Once you have made contact with an escrow or a title company they will be able to assist you with other items needed to complete the sale or transfer. This is not for a novice. You must have a working knowledge of how foreclosures work in your state, so make sure you read the books you purchase at you book store.

I hope this has been of some use to you,good luck.

"FIGHT ON"