Is it better to buy during the fist stages of preforeclosure or when the bank owns the house?
Answer:
In the first stages of preforeclosure. most times you can make a deal with either the owner or the bank without other "bidders". If you wait for the actual forclosure sale, you have to bid against others, which can cost you much more.
Let the bank own the house first, then launch a bid to buy the house. In this environment, there will be a lot of foreclosures due to people not making payment on real estate that have designer mortgages, such as ARM, and interest-only mortgages.This is the perfect time to buy foreclosures because banks hate to non-performing assets such as REOs. Also, check with small banks, savings and loans, and credit unions and ask for their REO list. Credit unions will be happy to lend you a list of their REO for their members to buy.
either way they are desperate.
the bank does NOT want to hold and manage the property
so you should be fine either way.
but like the first answerer said.. during preforeclosure, is a good time to deal cause people are thinking . oh my god what have i done?!
The possibilities in negotiating a purchase of a preforeclosure are endless but they basically brake down into three separate areas:
1.) You can approach the owner and have them sell you the property.
2.) You can approach the bank and
a.) have them sell you the note and you foreclose
b.) have them sell you an option to purchase after they
acquire the property
3.) If all else fails then approach the owner and buy their, statutory provided for, right of redemption so as to avoid having to pay the inflated price when the bank puts the property back on the market.
Buena Suerte
Depends upon the situation. For instance, if they owe $200,000 on a $500,000 property, that's a situation where it's probably better to buy from the owner. If they owe $550,000 on a $450,000 property, that's a situation where you're likely to get a better bargain by waiting until the bank owns it, because they're probably not going to approve that much of a short sale, but once it's on their books they want it off.
It is much better to buy before a house goes in to foreclosure
I do this all the time and I find it to be beneficial to both the home owner and myself if I buy it prior to the foreclosure. Plus, it feels good to help other people.
Regards
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