REO

[WICKER2996]

Can reo's still have other liens agaisnt it?

I ran across this house for $16,500 ,real vaule @136,800 , I haven't looked at the property yet, but think this is to good to be true?

Do deals like this come around ?

[Mr.fancypants]

Hi Wicker2996,

It could be that the house needs major repairs or that only the land is being sold. Last week I found what I thought was a killer deal, only to find out from the agent that the house was being relocated and it was only the land for sale. I've never found an REO deal as good as the one you're describing. If the house is worth $138k then that's what they're going to sell it for.

[WICKER2996]

hello Mr. fancypants

I found out that it is a very very nice house in a great neighborhood, but it did have a fire.  Looks like it started in the kitchen.

What would be too much to spend in fixing this house?  I have a contrator who I trust , (family friend) so I think I might go for it.  

From the outside you can't tell it had a fire at all.  I do believe when its all said and done it could be sold easily for 135.000 , which is under tax value.

Would financing be hard to get? I don't think that getting  loan for 16500 would be hard , but getting a loan to fix it up is what is going to be the cost.

thanks again :D

[Mr.fancypants]

Find an HML or other lender that will lend you money based on the ARV (after repair value of the house). If you find a lender that does 70% ARV and the house is worth 135,000 after repairs, the most they'll lend you (including purchase price and repairs) is 94,500. None of the repair money will be coming out of your pocket, if you work the numbers correctly. Good luck.

[WICKER2996]

Thanks for the info,

My contractor is going sat. to look at the property.  So I will find out the estimate , and go from there.

It actually is county owned so I,m going to have to bid.  I did find out someone has already bid 14k.  I have to go thru the upset bid procedure. How far should I bid , meaning how much profit should I say will be the least I take.  That will show me how high I have to bid agaisnt the competition.

I hope I'm making sense , Thanks again

Oh yea..................How much should I bid over his/her 14k.  Should I just start high like 17k or low 15k. Never did this, so Im very excited and nervous.  I can't let this one go.

[Mr.fancypants]

Usually they keep bids a secret, that way the seller gets the most money possible. But in your case, if the house is such a great deal you might just want to pay list price and get it quickly. The three big factors you need to figure out it are:

1-How much do they actually want for it?
2-How much will it cost to fix?
3-How much can I sell it for after repairs?

If the answers to these questions are good, then just get the house. You'll regret it if you miss out. I've hated myself a few times because I was being too conservative on my bidding and kept losing the house to other investors. But don't rush to any decisions until you've done your homework. Good luck

[Dave T]

In my area of the country, upset bid auctions are conducted at the courthouse 30 days after the foreclosure auction, at a specified time.  Anyone who wants to bid shows up.

The only requirement (in my county) is that the upset bidding starts at $1.00 above the final bid at the previous foreclosure auction AND the winning bidder at the previous auction is prohibited from bidding at the upset bid sale.  Bids are voice bids, or called out, just as they were at the foreclosure auction.

My first bid would be the starting minimum (in your case $14001 if this property is located in my county).  There is no set increment bid, and there is no limit to the number of bids I can make.  My limit will be the highest bid I feel I want to pay for the property.  If the bidding goes past my limit, then I sit down and stay quiet.  The winning bidder must present a 5% deposit in certified funds on the day of the auction, with the balance due within 30 days.

Perhaps a call to the officials handling the upset bid sale will clarify the local procedures for you.

[WICKER2996]

thanks Dave

I hope I get it, if not well I learn from my mistakes and keep on trucking.

[Skywalker]

I would like to get one of those deals too. Sounds very ggod