Foreclosure on Market for 8 months

[Britt Hennings]

My wife and I are moving up to the St.Louis area in the next 2-3 months. We are looking for a primary residence. We found a home originally listed for around $200k in a less populated area that's been on the market for 8 months and is now listed for $130k. I think I could get the bank to go lower since we are headed out of summer. The home needs some minor work done on the inside like flooring, deck, and paint. It also has a retaining wall that needs to be replaced. I talked to the realtor to ask if there was anything else wrong with the house and why it's been on the market for so long and he said it's cheap because it's a foreclosure and it needs some work. Comps in the area are all 190k and above. My plan was to finance it with a 203k loan and once everything was fixed refinance the house and pull out 30-40k in equity to buy a rental property. Call it BRORR. "O" is for own. I have never bought a house before, but I am confident in my abilities to do this. Is there anything I need to look out for with the foreclosure? How to negotiate with the bank for the lowest price? How soon will I be able to refinance? Is there a lot of red tape with the 203k? Should I be in state before I buy? Also any general advice is greatly appreciated. I've been listening to podcast for a few months now and have a grasp on all the concepts. I just lack experience.