Tag Archives: bank owned

How Not To Buy A Forclosure Property- 5 Costy Mistakes

18 Apr
Foreclosure Investing For DummiesBuying foreclosed property is the way to go if your plan is to save money. But saving money is only a dream if you don’t have this information.

Even if you find an almost free foreclosed home there are costly mistakes people make everyday. Be armed with this knowledge and truly get your dream home without nightmare cost!

1.) Over Bidding

Over bidding is a mistake that happens very often. Lack of planning before hand can be costly.Once you bid over the asking price the pre existing appraisal can not be used and a new appraisal is required.

It’s best to bid the asking price or a little lower to avoid problems (cost) from a new appraisal.

2.) Taxes

Many people that are not aware that certain state transfer taxes from Federal Government ownership to a private buyer are waived. Causing many to over pay on transfer taxes of the foreclosed property.

A majority of lending companies are unaware also because of the small amount foreclosure transfer they do. You have to make sure they know the rule in your state in order to save this money.

3.) Home Inspections

You should always get a home inspection done to make sure your dream home will not cost you ridiculous amount of money in repairs. Also tell the inspector, who works for you to let you know of all repairs needed for the foreclosed home . This list will be needed for the escrow amount that HUD has offered for repairs once you buy the home.

4.) Leave Your Money In Your Pocket

Most people don’t understand that the Federal Government will allow you to include most planned repairs to be added into the mortgage amount. So why spent your money on repairs if you don’t have to.

5.) Paying For Appraisals

You don’t have to pay for an appraisal if you have your lender request the appraisal already purchase by HUD and used to finance the home. Using the existing appraisal will save you hundreds of dollars. Always use the free existing appraisal from HUD or VA to save time,confusion, and money on a new appraisor .