Is purchasing a house at the time of foreclosure similar to buying a house that has already been foreclosed upon?

No. There are two different types of home foreclosures purchases. The first is when the lender actually forecloses on the property. If you’re interested in purchase you can show up in court and bid on the home foreclosure. The second type is when the lender or insurer actually owns the property and is selling it as its rightful owner.

Is the escrow the same as a typical real estate transaction?

No. When you’re buying home foreclosures at the time the lender takes the property back, you must show up in court, bid on the property, and if the bid is accepted, you are obliged to buy the house with a cashiers’ check, without inspections, and without any contingencies. When you’re buying from a lender or insurer after the house is already foreclosed on, there is still the opportunity to negotiate the price and terms, but because of the competitive market, the lender will normally end up calling most of the shots.

Do home foreclosures involve any additional legal concerns or fees?

No. With proper inspection, home foreclosures are unlikely to be accompanied by any additional legal concerns or fees. Bearing that in mind, remember that usually home foreclosures are sold “as is,” and due to the fact that the lender has never occupied the actual house, they are often not aware of the intricacies that may typically be required on a disclosure (for example leaking roofs or problems with electricity).

Does buying a foreclosed house involve any risk?

No. Purchasing a foreclosed home is unlikely to be risky if you do a thorough investigation. Be aware of the two facts: lenders will have limited information to work with for disclosures; secondly, people tend to get excited by the idea of a “sale,” and fail to notice the actual value of house foreclosures because of a “perceived value” issue. Consider the following hint: try to forget that it’s a foreclosure and think of it as a piece of real estate.

Is a foreclosure always an “as is” deal or can I negotiate with the bank for repairs or improvements?

As a buyer you can always try to negotiate, but conditions of the home foreclosures market are more likely to favor the lender, who will in most cases be able to sell the property “as is.”

For the majority of people, changing employers will have no impact on their ability to qualify for a mortgage loan. However, for some homebuyers the effects of changing jobs can be disastrous to their loan application.

Salaried Employees

• Salaried employees who don’t earn additional income from various commissions, bonuses, or over-time, switching employers should not have any problems. Just be sure to stay in the same line of work.  Hopefully, you will be earning a higher salary, which will improve your qualifications for a mortgage.

Commissioned Employees

• If a large amount of your income comes from commissions, it is unwise to change jobs before buying a home. This is associated with the way mortgage lenders evaluate your income. They estimate an average of your commissions over the last 2 years.

• Changing employers contributes to an uncertainty about your future earnings from commissions. No track record exists from which an average can be produced. Even if you are selling the same kind of product with virtually the same commission structure, the underwriter cannot be sure that past earnings will accurately reflect your future earnings.

Part-Time Employees

• If you earn an hourly income but rarely work 40 hours a week, you are not advised to change jobs. It would be impossible to tell how many hours you will work each week on the new job, so there would be no way to accurately evaluate your income. If you stick to the old job, the lender can just average your earnings.

Over-Time

• Because all employers award overtime hours differently, it is impossible to determine your overtime income if you change jobs. If you stay on your current job, your lender will give you credit for overtime income. They will establish your overtime earnings over the last 2 years and then calculate a monthly average.

When you decide the time is right to sell your house, you usually interview a number Realtors from various companies to decide which of them is best for your needs. You’d want somebody who will be your representative as well as someone you think will do a good job at marketing your home.
However, when someone makes a decision to purchase a home, they often end up with their Realtor through sheer accident. Why don’t they do a home buyer search for a Realtor the same way that home sellers do?
Instead, homebuyers typically end up with a Realtor they picked up from an advertisement. The advert will provide a short summary of a home available for sale along with the price, but it doesn’t say a word about the Realtor.

So… does it really make a difference?

Bear in mind that there are two “parties” in every sale. The listing side and the selling side. Usually deals have an agent representing each of the sides, so there are normally two agents involved. The seller’s side is represented by the listing agent. The buyer’s side representative is the selling agent (also referred to as the buyer’s agent).
Agents can deal with both buyers and sellers, but the majority tend to focus their work on one or the other. Some can even exclusively handle only buyers or sellers.

So what should you do?

It is generally recommended that you hire a real estate agent with as much care as you would with any other kind of professional. Ask them questions about their education, experience, and focus. In the end, buying your future home is presumably the biggest and most important purchase you’ve ever made in your life. Does it seem more sensible to find your agent by accident…or by design?

Stable Monthly Housing Costs

When you rent a place to live, you can obviously expect your rent to slowly increase each year – or possibly more often. If you get a fixed rate mortgage when you purchase a house, you have the same monthly payment amount for 30 years. Even if you get an adjustable rate mortgage, your payment will remain within a certain range for the entire period of the mortgage – and interest rates aren’t as volatile now as they were in the late 70s and early 80s.
Consider how much rent may be 10, 15, or even 30 years from now? Which seems more reasonable?

Forced Savings

Some people just don’t have the talent to saving money, and a house can be seen as an automatic savings account. Your savings increase in two ways. Each month, a part of your payment goes toward the principal. Sure, in the early years of the mortgage, this is not much. However, over time it speeds up.
Secondly, your house appreciates. Average appreciation on a home is about 5%, though it will differ from year to year, and in some cases it may even depreciate. Over time, history has shown that owning a home is one of the very best financial investments.

Freedom & Individualism

When you rent, you are usually limited on what you can do to improve your home. You have to ask for permission to make certain types of improvements. It also doesn’t make sense to spend thousands of dollars painting, putting in carpet, tile or window coverings when the main person who takes the benefits is the landlord and not you. Because your landlord wants to keep his expenses as low as possible, he or she will normally not be spending much to improve the place, either.