Ottakee Posted January 3, 2009 Share Posted January 3, 2009 Dh and I are in a unique situation. Right now our home is paid for and we are debt free. We have a 5 bedroom split level on 2 acres. The problem is 2 fold: 1. We would like an area so we could take our horses home with us 2. The state is planning on putting a highway through our home in the next 1-????? years (supposed to have paid us last year). I just found a foreclosed home for sale just 1 1/2 miles down the road that has 3 bedrooms (could expand in the basement) on 6.7 acres. It has 2 barns and some fencing already up. The location is wonderful for horseback riding as there are trails to state land, etc. I have called on the home but haven't heard back from anyone about seeing it. It appears to be empty right now. We live in an area with very high unemployment (one local area is 22% right now) and many foreclosures so we likely could get the house at a very reasonable price. Problem is, I don't think we could sell our home for very much right now as there are so many homes on the market and who would want to buy a house that might be torn down by a highway in the next few years. One option would be to rent out our current home as there are very few rentals that would have 5 bedrooms, 2 baths, 3 stall garage in a nice area in the country. We do have enough money for this other house even if we don't sell our current one but it would be a stretch. Back to the foreclosure stuff, what should I be aware of? The recording said that it was being sold AS IS but the home is only 4 year old. We would have it inspected but what else should we be aware of? Are we responsible for any back taxes that might be due? We honestly aren't in a hurry to move at all but this home does seem to meet all of our needs (except having AC which we could add) and now is a great time to buy a home in our area. Quote Link to comment Share on other sites More sharing options...
LisaKinVA Posted January 3, 2009 Share Posted January 3, 2009 Definitely have it inspected. All the inspection will do is make you aware of any obvious problems, and it may give you some additional leverege with your offer. They won't fix anything though. As far as responsibility for back-taxes, it depends. In some cases, the bank is required to keep up with all of those -- in other cases, they may not be required to do so. You'll need a title search and to find out if anyone has leins on the property. Also, if the house has a lock-box on it, any realtor can show you the property. A lot of times, the company listing the property isn't local and you won't hear back from them for weeks :tongue_smilie: (if ever). You want to find a realtor who has a good record of working in foreclosures, if you can find one. Quote Link to comment Share on other sites More sharing options...
lmrich Posted January 3, 2009 Share Posted January 3, 2009 I have never bought a foreclosure, but I would seek the expertise of a realtor. Do not use the realtor to rent your home as then he/she can take a chunk of change every month. Quote Link to comment Share on other sites More sharing options...
Pamela H in Texas Posted January 3, 2009 Share Posted January 3, 2009 We bought a foreclosure. We got twice as much house and land than we could have afforded without a foreclosure. There was very little wrong with the house (a 2001 and we bought in 2005) and it was all fixed before we moved in. We also got the selling bank to include a warranty as part of the deal. We just used the realtor on the sign out front, but she answered the phone immediately and met me 15minutes later. I wouldn't wait days or weeks for a realtor--any realtor can show you a house. HTHs, Pamela Quote Link to comment Share on other sites More sharing options...
ChristyB in TN Posted January 3, 2009 Share Posted January 3, 2009 Definitely have it inspected. All the inspection will do is make you aware of any obvious problems, and it may give you some additional leverege with your offer. They won't fix anything though. As far as responsibility for back-taxes, it depends. In some cases, the bank is required to keep up with all of those -- in other cases, they may not be required to do so. You'll need a title search and to find out if anyone has leins on the property. Also, if the house has a lock-box on it, any realtor can show you the property. A lot of times, the company listing the property isn't local and you won't hear back from them for weeks :tongue_smilie: (if ever). You want to find a realtor who has a good record of working in foreclosures, if you can find one. This is right. We buy them a lot and you get what see. Having it inspected will pretty much just let you know what you will be dealing with. A good realtor with experience in this area is a great idea and you want your own realtor. Find one who is really, really busy. This is a great way to get a good deal on a home and you may just be happy with your decision! We buy them to rent or to owner finance to people. The thing with renting right now is that the rental market is up so you won't get as much rent for your home as you might have expected. Every builder, it seems, is renting their vacant homes which haven't sold so their are a lot of home out there for rent. Just accept it and be happy if you can find someone who pays on time, kwim? I hope this works out for you one way or the other! Quote Link to comment Share on other sites More sharing options...
Brigitte Posted January 3, 2009 Share Posted January 3, 2009 I have never bought a foreclosure, but I would seek the expertise of a realtor. Do not use the realtor to rent your home as then he/she can take a chunk of change every month. I agree with finding a realtor for buying this house. The realtors are very good at helping to navigate all the legal/contractual stuff. As for using an agent/property manager for the rental of your home, I strongly recommend using an experienced property manager for rentals, unless you or you dh are willing and able to take calls at all hours, you are comfortable showing the house to strangers, etc. We pay 10% to our manager and it is worth every penny. They show it, do credit checks, take the call when repairs need to be made, deal with the person/company doing repairs, deal with late payments from tenants, and they were able to get us a much better deal on new appliances than we were able to get. Just my .02. Quote Link to comment Share on other sites More sharing options...
coffeefreak Posted January 3, 2009 Share Posted January 3, 2009 I am totally intrigued about your situation. If the town you live in changes their mind, what will you do with your old house? When are they supposed to imminent domain it? I might get a lawyer and get them to pay up NOW so you have a decent down payment for the next house. Plus, like you said, no one is going to want to buy a house the town may or may not take in the next couple of years. BTW can you move your house? Quote Link to comment Share on other sites More sharing options...
Kari C in SC Posted January 3, 2009 Share Posted January 3, 2009 (edited) We bought a foreclosure. We got a pretty good deal, but we did find some problems after the fact. We didn't have it inspected because it was a fairly new house. We bought it in May from out of state. When we came to work on in it July, we noticed that the ac was not working. That would be due to the fact that somebody stole the coil out of it. We were able to claim it on our insurance, because we don't know exactly when it was stolen. It could have been after our purchase. The other problem we had had to due with liens from the HOA. The bank finally paid most of it. The final problem we had was the Lake Association sued us for an assessment that should have been billed to the bank. They claimed the didn't know how to find the bank owner (Public records???), so they just waited until it sold and assessed it to the new owners. That was about $3700 and I was freaking out. Luckily, we had some type of Plus Title Insurance that covered more than the standard. So, it was all paid for as well. FWIW, my realtor was NO HELP in any of this. The realtor was hired by the bank. I don't know if that was a good idea or not. I guess my advice would be to do lots of research and get the best title insurance policy you can get. It really doesn't cost that much more to get the upgraded one. Good luck. ETA: We could not sell our original house in Florida, so we are renting it out. It comes pretty darn close to covering both mortgages. The thing to remember is that to avoid capital gains, you must live in your rental 2 out of 5 years. So, you have a little time to rent it and not have to worry about the tax man eating a huge part of your profit. Edited January 3, 2009 by Kari C in SC Quote Link to comment Share on other sites More sharing options...
Ottakee Posted January 4, 2009 Author Share Posted January 4, 2009 Well, I talked to a realtor (one we called) at 1:30 this afternoon for the first time. By 2pm we were meeting at the house. It is PERFECT for what we need. The house itself is brand new, never lived in with 4 bedrooms. Then there is a big pole barn with car repair area (dh is a mechanic), office, bathroom, another small car part AND a 2 bedroom apartment with appliances--even washer and dryer. The PROBLEM is that the house is on 6.7 acres but.................the house itself sits 37.5 from the rear property line. That means we could have neighbors very close behind us. Also, the township has some zoning that you can't build any structures in your FRONT yard which means all of the land is in the FRONT of the house. The realtor is calling about all of the zoning stuff on Monday. We then might make a lower offer and see what happens. If the house was better situated on the property we would make an offer by Monday. Quote Link to comment Share on other sites More sharing options...
Jean in Newcastle Posted January 4, 2009 Share Posted January 4, 2009 Are you wanting to build on the property? If building is important to you, the rule about not building to the front of the house seems to be a big one. Quote Link to comment Share on other sites More sharing options...
dawn of ns Posted January 4, 2009 Share Posted January 4, 2009 FWIW, my realtor was NO HELP in any of this. The realtor was hired by the bank. I don't know if that was a good idea or not. We're looking for a house as I type and my first step was to get a realtor that didn't have any of the listings I was interested. I'm quite sure there are good agents out there who can navigate the ethical waters of representing the seller AND the buyer but I'm not interested in taking the chance that the one listing the house I want is one of those. Personally, I'd always get an agent who's working just for me. Quote Link to comment Share on other sites More sharing options...
Jeanne in MN Posted January 4, 2009 Share Posted January 4, 2009 We got the perfect place for us and paid half of what it has now been appraised at. We got a great deal. The septic system had to be replaced almost right away as the basement was backing up. There was no information on that problem when we went into it and it was an expensive thing to fix unexpectedly, but we got such a good deal it was hard to complain about spending the money to update something that was much better for the environment anyway. Quote Link to comment Share on other sites More sharing options...
Ottakee Posted January 4, 2009 Author Share Posted January 4, 2009 Right now the home/property has everything we want on it but we just don't want to have an almost 7 acre mini farm that we can't expand on in the future if we would want. Having almost NO back yard though is the other issue. There is only about 12 feet from the back of the deck to the lot line. With almost 7 acres we would like a back yard to enjoy and not have the the neighbors be SO close. We still might make a very low offer on it and go from there--then we would have some money to do some other things with in the future. Are you wanting to build on the property? If building is important to you, the rule about not building to the front of the house seems to be a big one. Quote Link to comment Share on other sites More sharing options...
TraceyS/FL Posted January 4, 2009 Share Posted January 4, 2009 Gee, that stinks that they let them build it so close to the property line. It sounds perfect though! Our house now has the front and back yard flopped. They seem to like big front yards around here - which is great.... BUT.... the guy we bought from (who had bought it as a foreclosure to flip) had had the address changed to our driveway entrance. So now our official "front yard" is smaller than the backyard as it should be. But overall we sit almost smack dab in the MIDDLE of 1.25 acres. ANYWAY, I hope it all works out for you!!!!! (also, i wonder if there would be any chance of a zoning variance so you could build something out front? They seem to do them around here quite often) Quote Link to comment Share on other sites More sharing options...
Ottakee Posted January 4, 2009 Author Share Posted January 4, 2009 They can build 25 feet from the property line and they came very close. I am going to look at it again this afternoon. This time I am going to take some measurements of the rooms to see how/if our furniture would fit. I will also take a better look at the property line, etc. A friend of mine that is an architech is going to meet me there to help me check out a few things. She has a great eye for things and will mention any potential problems to me--even if they are traffice flow issues, etc. We did get ahold of the building inspection reports and those looked good---it passed and was not left out in the weather long at all. This is just a lot to think about. Quote Link to comment Share on other sites More sharing options...
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