Posted by Corey on October 08, 2002 at 17:19:41:
Appreciate the post. Yes I am very familar with RE and the laws but by now means an expert.
Went and looked at the house today on the inside for the first time. Wasn’t too bad but when you started adding everything up for repairs you can buy the house down the street finished for close to the same price.
Gonna pass on this one but will attend the auction for an eduction.
Corey (North Dakota)
Questions: Rural Development (Gov’t) forclosure - Posted by Corey
Posted by Corey on October 06, 2002 at 22:34:16:
I live in the rural midwest and am looking at an add in the local paper. "Forclosure sale 4 bedroom, 2 story home 2 baths, 17xx SQ FT. Appraised value xx,000.00. Sale Date: (soon). Rural Developments bid will be $x,000.00. A higher bid will purchase the property. Cashiers check needed the day of sale. For more infor contact: Rural Development office (local office and phone number.
I have kept important info private as I don’t want any more competition on this sale.
The Development bid is 20% of the “appraised value”. Now I am pretty familar with the local market and the “appraised value” is probably 10% higher than market selling prices.
I am wondering what the do’s and don’ts are of buying at a forclosure sale. Looking on the Rural development website they state: “The exterior & interior need painting. Floor coverings & shingles need to be replaced. The garage should also be replaced”.
I have been buying homes and one commercial property via semi-conventional means. I have partnered with my father on these deals. We buy, do some repairs and keep for long term rental. Most have provided a decent cash flow of $200-$300 each per month in positive cash flow. This one looks like it would cash flow $300-$400 a month.
Here are my concerns and problems.
#1: Not enough time to get funds from a traditional mortgage lender.
#2: Possible title problems after sale.
#3: Possible redemption from former owner after sale (Statutory right of redemption).
#4: Internal condition of property including plumbing, wiring, foundation, etc…
So how does a person go about getting this deal done? What are the things to look out for before bidding? How can a person obtain “temporary funding” until a regular mortgage can be obtained? What about buying the home from the “current owner” before it goes to auction?
Thanks,
Corey
nospam-coreybayer@hotmail.com (remove the nospam- to contact me)
Update: Rural Development (Gov’t) forclosure - Posted by Corey
Posted by Corey on October 07, 2002 at 10:15:10:
Just spoke with a representitive from Rural Developemnt (Which is a branch of the USDA). They stated that there is a 60 day right of redemption. And you only get a quit claim deed.
So what is the best way to find any potiential leins on the property (Title search via title company, or just search at courthouse?)
Thanks for any help you will provide.
Corey
Re: Update: Rural Development (Gov’t) forclosure - Posted by michael
Posted by michael on October 08, 2002 at 05:32:04:
Corey,
Going into the foreclosure arena armed with the info gleaned from a handful of posts on this website, is akin to entering the ring with Mike Tyson after reading a boxing article. In both cases you have a very good chance of getting your head handed to you, one literally, the other figuratively.
It sounds like you have enough experience to proceed with adding foreclosure investing to your bag of tricks, but first you need the knowledge specific to your state before spending your dough.
Get a couple of books on foreclosures, and get a copy of your states foreclosure statutes. Read them all till you know them backwards and forwards, because there are no weasel clauses that are gonna save you in this area.
P.S. No, you don’t do your own title searches. Hire
Professionals.
cheers,
michael