Buying a Foreclosure

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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

2mo

It is impossible to provide any type of informative response because the property could be completely trashed or the property could have been recently renovated.

All I will say is when buying foreclosures, make sure to get a very thorough home inspection done and understand there are typically considerable costs to get the property financed. Many of the items, while they may be working (such as hot water heaters and HVAC or the roof), may have shorter life spans to them and may need to be replaced within the next five years. This could be a considerable cost that should be taken into account.

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Drew SygitBusiness Member
Property Manager · Royal Oak, MI · Member since 2012 · 12k+ posts · 9k+ votes
2mo
Quote from @Chris Seveney:

It is impossible to provide any type of informative response because the property could be completely trashed or the property could have been recently renovated.

All I will say is when buying foreclosures, make sure to get a very thorough home inspection done and understand there are typically considerable costs to get the property financed. Many of the items, while they may be working (such as hot water heaters and HVAC or the roof), may have shorter life spans to them and may need to be replaced within the next five years. This could be a considerable cost that should be taken into account.

Don't forget to have the sewer line camera'd!
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Alejandra Sandoval

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Member since 2025 · 8 posts · 3 votes

2mo

Thank you for your response, Chris! It seems that (without having yet done the inspection) the home is in very livable condition, just older (early 2000s) and needing cosmetic updates. I do think as you mentioned that we will find out that the roof is original and will need replacement soon, etc. but overall if you don't mind ugly paint and laminate counters, it is totally livable and in good condition.

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Ken M.

Investor · Get yourself trained before doing something inadvisable. · Member since 2024 · 3k+ posts · 1k+ votes

2mo

Quote from @Alejandra Sandoval:

Hello everyone! My husband and I are looking to buy a foreclosure sold by a gov agency basically as a live-in flip into long term rental. For context, the comps in the neighborhood are about $285k-$325k and we have it under contract for $260k currently. Asking price was $240k but then they asked for highest and best and when I ran the numbers (to the best of my ability with limited experience) 260k was the highest we could offer and still get a monthly payment that was about $400 below comps for the neighborhood (so that we could at a minimum break even once accounting for cap-ex, vacancy, potential property management, etc).

Anyways, to say I am overwhelmed and second guessing myself is an understatement! lol. We go into inspection this week and I am so nervous, and won't know until appraisal if its even worth what we offered but I'm curious overall if even trying to buy an "as is" foreclosure is a bad real estate deal.

Thank you!!!

I've been buying pre-foreclosure and foreclosures for 30 years. They always are a surprise. ;-)
Very few have had any serious maintenance in a long time so be prepared. I missed what year the house was built but have the sewer scoped, it's expensive to replace the line. Make sure you get a "roof life" to determine how long the roof will last. The heating unit, what type of wire was used to wire the house and what type of pipe was used to plumb. Don't rely on your real estate agent for construction advice. Get a contractor to tell you what costs are.
There is obviously more and if you request more I'll provide it.

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Buying a Foreclosure

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