What’s the trick with foreclosure houses and just houses <500k like in sf? It looks good but I guess I can’t buy it so easy
Trick is - you won’t have a detailed inspection for the house and have to pay in cash on auction day/show proof of funds for full cost of house
Trick is just a lot of cash, knowledge, and a lot of competition.
You need to come with cash to close at a foreclosure. Plus you may have to content with bank attorneys fees that get added to the foreclosure amount. I’ve seen foreclosures over 600k in NYC not included are attorneys costs and transfer taxes. You’re buying sight unseen. You might as well light a wheelbarrow of cash on fire. One of my neighbors paid 1.2 million for a house with a compromised foundation. They will soon have to pay 250k to jack the house up and pour a new foundation.
Foreclosure houses can be a great opportunity and a great deal. They can also be a nightmare. Mortgages are very difficult. Almost all are cash. Not having a bank involved other than the obvious cash requirements leaves you out there on your own. The bank has your interest in mind because they have their interest in mind. Points of interest: is the property marked as a drug house or other hazardous conditions that can make the property a compleat liability. Clear title including utilities taxes and Leans need to be a consent. The good news is usually you don’t need to completely rehab a property to make a profit. You just need to get it mortgage-able to make a great return. My best suggestion is to ignore the TV shows on flipping. It’s not reality.
There are millions of investors crawling all over every decent and even poor real state markets these days. The banks love to send a rep to bid up the property at auctions too. Tough go.
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Normally foreclosed houses are in really bad shape and sometime previous owners destroy it from inside. Remember, house goes for foreclosure when owner can’t keep up with mortgage payment and gets evicted by bank
you can’t pay mortgage so you start destroying the house from inside?
@pusandisp yes people usually did that..