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Best advice for buying your first house?

Home ▸ Archive ▸ Serious Business ▸ Best advice for buying your first house?
OneBuckeye's avatar

OneBuckeye

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5,888 posts
May 25, 2011 8:13 AM
http://www.ohiochatter.com/forum/threads/16480-Best-advice-for-buying-your-first-house

This thread got locked so thats why I started this one.

We are starting to look at houses. I am looking for any advice but specifically on buying foreclosed homes and how to avoid a bunch of extra fees/costs. We are looking for a good value and are not in a hurry. Also one of the prosepects has an in ground swimming pool...
May 25, 2011 8:13am
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BR1986FB

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24,104 posts
May 25, 2011 8:16 AM
Definitely go the foreclosure/bank repo route if possible. I'm just about done flipping a house that I bought for $7500. Should sell for close to $100k (put about $35-40k in materials into it). I have my eye on another one in the same school district that's listed at $8900.
May 25, 2011 8:16am
thedynasty1998's avatar

thedynasty1998

Senior Member

6,844 posts
May 25, 2011 8:18 AM
Do you have some cash? Foreclosures are a great idea but often times they require som work so be prepared to spend on upgrades. Also I think you usually need a conventional loan on foreclosures.
May 25, 2011 8:18am
OneBuckeye's avatar

OneBuckeye

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May 25, 2011 8:24 AM
We have some cash. I think we could go to a sherriff sale and buy there. One of the foreclosures we are looking at has a Zillow estimate of 120k and is listed by REMAX for 80k. The property is owned buy Bank of America, is it normal for reality companies to list foreclosures? I don't know much about this stuff.
May 25, 2011 8:24am
OneBuckeye's avatar

OneBuckeye

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5,888 posts
May 25, 2011 8:25 AM
BR1986FB;779792 wrote:Definitely go the foreclosure/bank repo route if possible. I'm just about done flipping a house that I bought for $7500. Should sell for close to $100k (put about $35-40k in materials into it). I have my eye on another one in the same school district that's listed at $8900.

Dang, where do you find these houses?
May 25, 2011 8:25am
derek bomar's avatar

derek bomar

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3,722 posts
May 25, 2011 8:27 AM
i'm kind of ignorant and don't feel like googling...what site can I go to to find info on foreclosures / shorts sales in Franklin Co?
May 25, 2011 8:27am
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BR1986FB

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24,104 posts
May 25, 2011 8:32 AM
derek bomar;779800 wrote:i'm kind of ignorant and don't feel like googling...what site can I go to to find info on foreclosures / shorts sales in Franklin Co?

Try foreclosure.com. I usually get listings sent to me weekly.
May 25, 2011 8:32am
OneBuckeye's avatar

OneBuckeye

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5,888 posts
May 25, 2011 8:33 AM
BR1986FB;779803 wrote:Try foreclosure.com. I usually get listings sent to me weekly.

How much does it cost? I got hit with an ad for a 7 day free trial.

Edit: found this
thirty nine dollars and eighty cents per month
May 25, 2011 8:33am
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BR1986FB

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24,104 posts
May 25, 2011 8:35 AM
OneBuckeye;779799 wrote:Dang, where do you find these houses?

Out near where I live (Sebring). I usually only purchase them in a local/favorable (West Branch) school district so I can turn them quickly.

I will say that I'll be going about my next flip A LOT differently. I got my girlfriend's brother to do all of the labor and he "promised" that it would be "done and on the market in no less than 6 months." That comment was made in 10/08. Mother fucking lazy ass loser.
May 25, 2011 8:35am
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BR1986FB

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24,104 posts
May 25, 2011 8:36 AM
OneBuckeye;779804 wrote:How much does it cost? I got hit with an ad for a 7 day free trial.

Edit: found this

The listings I usually get are free. It only gives a price & address though. Can't do the "virtual" tour.
May 25, 2011 8:36am
Commander of Awesome's avatar

Commander of Awesome

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May 25, 2011 8:40 AM
BR1986FB;779806 wrote:I got my girlfriend's brother to do all of the labor and he "promised" that it would be "done and on the market in no less than 6 months." That comment was made in 10/08. Mother fucking lazy ass loser.

I find most contractors to be lazy ass losers. My mom always uses her neighbor because she feels obligated to for things. Guy never shows up on time and IMO overcharges her.
May 25, 2011 8:40am
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BR1986FB

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May 25, 2011 8:46 AM
Commander of Awesome;779808 wrote:I find most contractors to be lazy ass losers. My mom always uses her neighbor because she feels obligated to for things. Guy never shows up on time and IMO overcharges her.

I feel like he's got me by the proverbial "balls" because I'm not mechanical at all. If something breaks in the house I call him to do it. I plan on having a new roof put on my house but there's no way I'm getting him involved. He'll probably be cheaper but it's a matter of "pay the extra $2k to have it done in 3 days of pay less and wait 2 months for him."

Once he started working on the flip he had me because I'm not in a position to pay a legit contractor cash out of pocket. Her brother is waiting to get paid when it sells but it will be a nice lump sum. The only problem is that if he gets another "side job", my flip gets pushed aside so he can get money in his pocket. Dude has no sense of urgency and can't see the forest for the trees. Instead of getting it done and possible getting $25k in his pocket he'd rather blow it off for a $300 side job.

A semi-trained monkey with a hammer could've had this flip done in under a year.
May 25, 2011 8:46am
thedynasty1998's avatar

thedynasty1998

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6,844 posts
May 25, 2011 8:47 AM
OneBuckeye;779795 wrote:We have some cash. I think we could go to a sherriff sale and buy there. One of the foreclosures we are looking at has a Zillow estimate of 120k and is listed by REMAX for 80k. The property is owned buy Bank of America, is it normal for reality companies to list foreclosures? I don't know much about this stuff.

Be careful with this reasoning. Zillow doesn't know the condition of houses. They base their estimates on comps. If you buy a foreclosure and think it's worth 120k but is bought for 80k there is a reason. Banks are not in the business of giving stuff away. So you might buy it for 80k buy say you have to put in 30k, is it really a deal. Especially considering if you borrow the 30k to fix it up you will be paying a much higher rate.
May 25, 2011 8:47am
OneBuckeye's avatar

OneBuckeye

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May 25, 2011 8:50 AM
thedynasty1998;779816 wrote:Be careful with this reasoning. Zillow doesn't know the condition of houses. They base their estimates on comps. If you buy a foreclosure and think it's worth 120k but is bought for 80k there is a reason. Banks are not in the business of giving stuff away. So you might buy it for 80k buy say you have to put in 30k, is it really a deal. Especially considering if you borrow the 30k to fix it up you will be paying a much higher rate.

Totally agree... obviously I would hope a home inspection would help point things like that out. How much does a good home inspection cost?
May 25, 2011 8:50am
thedynasty1998's avatar

thedynasty1998

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May 25, 2011 8:52 AM
BR1986FB;779792 wrote:Definitely go the foreclosure/bank repo route if possible. I'm just about done flipping a house that I bought for $7500. Should sell for close to $100k (put about $35-40k in materials into it). I have my eye on another one in the same school district that's listed at $8900.

Doesnt sound like the great deal you made it out to be originally. Have 50k invested, have yet to pay labor and have had it for almost 3 years. After capital gains, pay a realtor, you will clear what, 10k max?
May 25, 2011 8:52am
thedynasty1998's avatar

thedynasty1998

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6,844 posts
May 25, 2011 8:53 AM
OneBuckeye;779818 wrote:Totally agree... obviously I would hope a home inspection would help point things like that out. How much does a good home inspection cost?

If you buy at a sheriff auction you don't have that option. Some banks may not let you.
May 25, 2011 8:53am
OneBuckeye's avatar

OneBuckeye

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May 25, 2011 8:56 AM
thedynasty1998;779822 wrote:If you buy at a sheriff auction you don't have that option. Some banks may not let you.

Didn't think they would do that on a foreclosed house listed by a real estate company. Interesting.
May 25, 2011 8:56am
se-alum's avatar

se-alum

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May 25, 2011 8:56 AM
OneBuckeye;779795 wrote:We have some cash. I think we could go to a sherriff sale and buy there. One of the foreclosures we are looking at has a Zillow estimate of 120k and is listed by REMAX for 80k. The property is owned buy Bank of America, is it normal for reality companies to list foreclosures? I don't know much about this stuff.
Most counties have a County Auditor website where you can look up properties. You can see sales history, appraisals, and a few other things. Basically, you can see what the bank has invested in the property and offer that. Banks aren't in the business of being property managers, so they are usually willing to give it up for what they have in it. Also, if you're looking into sheriff sales, make sure you pay attention to the terms. Some counties wave any liens on the property when you buy it(it takes longer to get the deed, because it has to go through some legal red tape, but you have it free and clear), and some just transfer the lien to you, which you have to pay off to get the property. Lien information can be obtained at the county courthouse, typically.
May 25, 2011 8:56am
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BR1986FB

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24,104 posts
May 25, 2011 8:58 AM
thedynasty1998;779820 wrote:Doesnt sound like the great deal you made it out to be originally. Have 50k invested, have yet to pay labor and have had it for almost 3 years. After capital gains, pay a realtor, you will clear what, 10k max?

Actually I should net about $30k. I went high on the materials.
May 25, 2011 8:58am
OneBuckeye's avatar

OneBuckeye

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May 25, 2011 9:02 AM
se-alum;779826 wrote:Most counties have a County Auditor website where you can look up properties. You can see sales history, appraisals, and a few other things. Basically, you can see what the bank has invested in the property and offer that. Banks aren't in the business of being property managers, so they are usually willing to give it up for what they have in it. Also, if you're looking into sheriff sales, make sure you pay attention to the terms. Some counties wave any liens on the property when you buy it(it takes longer to get the deed, because it has to go through some legal red tape, but you have it free and clear), and some just transfer the lien to you, which you have to pay off to get the property. Lien information can be obtained at the county courthouse, typically.

Did that. The bank has 79k in the house in question. Unfortunately their records only go back to 1988 and the only info was the on recent foreclosure.
May 25, 2011 9:02am
said_aouita's avatar

said_aouita

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May 25, 2011 9:06 AM
Check zoning carefully. You don't want to buy some cheap house only to find out it's considered in a flood zone.

If the crooked FEMA think you are in a flood zone, good luck proving you are not.


What a pain in the ass........
May 25, 2011 9:06am
thedynasty1998's avatar

thedynasty1998

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May 25, 2011 9:08 AM
BR1986FB;779828 wrote:Actually I should net about $30k. I went high on the materials.

So 30k in materials and 25k in labor? Doesn't make sense to me. If you have a friend as the contractor their labor certainly shouldn't cost as much as materials.

Can you explain further where you're getting 30k from? Are you going to use a Realtor? Do you anticipate paying 6% for Realtor fees and likely some of the buyers closing costs? How do you anticipate being taxed?
May 25, 2011 9:08am
thedynasty1998's avatar

thedynasty1998

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May 25, 2011 9:10 AM
OneBuckeye;779824 wrote:Didn't think they would do that on a foreclosed house listed by a real estate company. Interesting.

Sheriff auctions are differed than bank owned. A bank buys it at the sheriff auction.

Whats the address of the house? I have access to BOA REO's.
May 25, 2011 9:10am
ernest_t_bass's avatar

ernest_t_bass

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May 25, 2011 9:17 AM
Research EVERYTHING! Go to the auditor's website and find out historical sale prices. Check all your comps. Have YOUR number and don't budge. If they don't want to accept, then move along. Get an inspection. Research EVERYTHING!
May 25, 2011 9:17am
OneBuckeye's avatar

OneBuckeye

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May 25, 2011 9:20 AM
thedynasty1998;779837 wrote:Sheriff auctions are differed than bank owned. A bank buys it at the sheriff auction.

Whats the address of the house? I have access to BOA REO's.

PM sent.
May 25, 2011 9:20am