NEW-1st buy Foreclosure?

3 Replies

Hello,

New to the site and fairly new to real estate. I live in WA and am looking to invest in a home. I found a nice home in Everett, WA but it is a foreclosure.

A coupe questions:

As a first buy should I buy a foreclosed home? I'd be buying it as is so it could be a mess. I do expect and do want to rehab the house (there is an unfinished basement too).

2nd, how does buying foreclosed homes work? Aren't those typically bid up up and beyond the listed price?

Thank you for all your great advice!

Has the foreclosure already happened? That is, is the property a bank REO? If so, you buy it from the bank just like any other seller. You make your offer through an agent.

Or, do you mean buying it at the sheriff sale (or whatever its called)?  Dangerous game for a new investor.   And you need cash to buy on the spot.  Most typically, the bidding starts at what's owed, nobody bids, and the foreclosing lender gets the property.  Sometimes they start the bidding low enough to draw bids.

Or, do you mean a preforeclosure.   You buy those from the owner.  If there is a short sale, the bank has to approve it.

@Jon Holdman

It is being sold by the lender (the bank). 

Originally posted by @Naveed Nabavinejad :

Hello,

New to the site and fairly new to real estate. I live in WA and am looking to invest in a home. I found a nice home in Everett, WA but it is a foreclosure.

A coupe questions:

As a first buy should I buy a foreclosed home? I'd be buying it as is so it could be a mess. I do expect and do want to rehab the house (there is an unfinished basement too).

2nd, how does buying foreclosed homes work? Aren't those typically bid up up and beyond the listed price?

Thank you for all your great advice!

Foreclosed homes can be great investment opportunities and good candidates for fix and flip.  But just because it is foreclosed doesn't mean it is priced competitively.  You should run the numbers to see if it makes sense.  Typically, if the price is too good to be true, then it will get bid up beyond the listed price.

Good luck!

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