Buying A Foreclosed Home

Almost everyone has heard of buying a foreclosed home. The opportunity for instant equity is tremendous.

I just read a letter from Frank. I'll take you to his letter in a moment because he did his homework. But for right now here are his two questions:

Buying A Foreclosed Home And Appraisal

Question: Will the lender use the appraisal of the county as the property value, which in my case would help towards a good LTV?

Answer: The rule of thumb that establishes value for a home mortgage is purchase price or appraised value whichever is less.

For example, if a sales price is $200,000 but the real estate appraiser returns a value at $175,000, the home mortgage will be figured off of $175,000.

Conversely, an agreed upon price of $200,000 will be the basis for the lender's calculations even though it appraises for $250,000.

I have seen exceptions to this rule of thumb so consult your lender. You can also ask about using the county assessment instead of paying for a market appraisal.

Buying A Foreclosed Home And Mortgage Approval

Question: Are there any other surprises that I may be overlooking?

Answer: Eliminate surprise with mortgage approval. Ordinarily I encourage mortgage pre approval. But due to non-refundable nature of down payments following an auction, I would get mortgage approval subject only to appraisal and title insurance.

Consider going one step further. Ask your home mortgage lender if mortgage interest rate lock is available before the auction too.

The point is to reduce as much risk as possible since your down payment might be non-refundable.

Buying A Foreclosed Home And Building Your Wealth With Auctions

Have you found yourself asking...

• Are there any good real estate deals left?
• Are real estate auctions complicated?
• Where can I find current information about auctions in my area?
• How can I begin buying a foreclosed home?

Ask Kate To Translate

Ask Kate

What if you could ask a mortgage insider anything you wanted regarding your home mortgage? Now you can.

Ask Kate is specifically designed to answer your questions and create dialog regarding mortgage financing.

Learn More About Your Dream Team

How To Buy A House Part 1 Meet your real estate agent and save yourself heartache and headache.

How To Buy A House Part 2 Meet your mortgage lender - Discover why closing loans requires more than quoting the lowest rate or taking an application.

How To Get A Mortgage Part 3 Meet your home inspector and avoid buying a money pit. It's THAT simple!

How To Get A Mortgage Part 4 Meet your real estate appraiser - Don't fall into the trap of thinking the appraisal assures you of a good deal.

How To Get A Mortgage Part 5 Meet your title insurance companies for little known coverage resulting in peace of mind.

How To Get A Mortgage Part 6 Meet your homeowners insurance agent because there is more to getting insurance than the cheapest quote.

How To Get A Mortgage Part 7 Meet your escrow and HUD 1 statement - Find out why escrow is the guardian of your real estate transactions.

Ask Kate About Home Buying - Ask a question to get an answer from Kate.

How To Buy A House Q and A - A complete collection of questions about home buying, each with a individual answer from Kate

The letter from Frank inspiring Buying A Foreclosed Home - Buying A Home In Foreclosure

Return home to Get Your Best Mortgage Rate from Buying A Foreclosed Home

Help Spread The Word

Please come back and visit often. Help me spread the word by sharing Buying A Foreclosed Home with your friends using these easy social bookmarking buttons.