My costs in buying a home in pre-foreclosure

[Ricky Knack]

Let me start with saying I'm really enjoying all the helpful information out in BiggerPockets land. I was wondering what costs are associated with buying a house in pre-foreclosure vs a house not in pre-foreclosure. If I'm buying the home, do I become responsible for the seller's default amount? Taxes? What other considerations am I missing?

[Account Closed]

Originally posted by @Ricky Knack:

Let me start with saying I'm really enjoying all the helpful information out in BiggerPockets land. I was wondering what costs are associated with buying a house in pre-foreclosure vs a house not in pre-foreclosure. If I'm buying the home, do I become responsible for the seller's default amount? Taxes? What other considerations am I missing?

 Buying a house in pre-foreclosure is tricky depending on the state you live in. In a couple of states it is actually illegal to solicit people who are in pre-foreclosure or in the foreclosure process. Ask a real estate attorney for the state you are considering.

But, here are some costs:

Unpaid principal

Arrears

legal fees of the pre-foreclosure

home owner's insurance

money to the seller for moving

money to the real estate agent if one is involved

title insurance

escrow

pre-paids

unpaid property taxes

unpaid 2nd loan if it exists

unpaid electric bills

unpaid water bills

unpaid gas bills

unpaid mechanics liens

unpaid fines for city violations

deferred roof maintenance

deferred maintenance in general

dumpster to get rid of everything left behind