Buying American property

[dustingthestars 9]

Morning VJers! (In Moscow it morning anyway!)

I had some property related questions I was looking for some help on. We have tried reaching out to various realtors and banks but haven't had any answers as of yet.

For the past couple of weeks, my fiancée and i have been looking for a 'fixer-upper' in her local community (Macon, GA) and we have stumbled upon quite few foreclosures selling anywhere from $6000-$14000. There are a few we've liked so my fiancée has visited a couple of them and has generally been impressed.

• Is it normal for a foreclosure to be so cheap to buy? Should the price be setting any alarms bells off? The ones we've looked at are in decent parts of town, the only perceived negative is that they are a little bit away from everything, but we like that aspect!
• How much do closing fees and whatnot tend to add to the price on average? I'm intending to buy in cash and not use any finance at all - if that makes any difference at all?
• We're aware of the work involved as some of them have been empty for a while, but are there any tell-tale signs we should be looking out for? We've been given a list by various family members of what to look out for; things such as types of piping in the plumbing, the outlets and the woodwork, but it would be good to get some more input.
• Having found one we liked, would it be as simple as paying the cash and getting the deeds? I'm guessing not, but it would be good to get some info on that aspect too!

I guess I'm also looking for thoughts from people about whether foreclosures are the bargain they appear to be, if you don't mind putting work into them, that is!

Thanks in advance,

[웃 910]

• Is it normal for a foreclosure to be so cheap to buy? Should the price be setting any alarms bells off? The ones we've looked at are in decent parts of town, the only perceived negative is that they are a little bit away from everything, but we like that aspect!
• How much do closing fees and whatnot tend to add to the price on average? I'm intending to buy in cash and not use any finance at all - if that makes any difference at all?
• We're aware of the work involved as some of them have been empty for a while, but are there any tell-tale signs we should be looking out for? We've been given a list by various family members of what to look out for; things such as types of piping in the plumbing, the outlets and the woodwork, but it would be good to get some more input.
• Having found one we liked, would it be as simple as paying the cash and getting the deeds? I'm guessing not, but it would be good to get some info on that aspect too!

1) Yes. Well, usually not that cheap but if you are familiar with the area and surrounding homes then you should be ok. You should see the house before you buy it. Let the alarm bells go off when you see it before purchasing it.

2) When I bought a house cash I barely noticed anything in closing costs. It was a dirt cheap house, like the ones you are looking at. The price was $9,500 but I think I paid around $11,000 at the end of the day. .....If you finance then that is when you have to worry about big closing costs. THOUSANDS!

3) Whatever you think it costs add about 40% to that. If it is a smaller home it shouldn't be more than $10,000 to do everything including carpet, paint, doors, every light fixture, every light switch, every piece of trim, appliances, floors, and every bathroom vanity. If you are tight on finances, have your fiancee (if she is the USC and has decent credit) apply for a Home Depot store card. They have ridiculous rates BUT they have 6 months interest free financing so you won't pay a single dime up front. They started me off with $5,000 when I applied, and I didn't think my credit history was that great at the time.

4) Yes, it's that simple. Get the bank to give you the green light and you will get a closing date. You'll get all your paperwork that day and be done with it.

[belinda63 3,047]

Wow glad to see we weren't the only ones. We got a foreclosure, closing costs were $99. saves a lot when you don't have inspection fees, bank loan fees, etc. We did learn the hard way what to look for in the next one we buy. Had the water turned on and multiple leaks appeared, furnace was almost as old as me and we were too scared to even try lighting it, some water damage we didn't notice.

All in all it has been worth it, the money we have saved on rent/mortgage has been well spent fixing the place up and I think we will turn a good profit if we ever decide to sell or rent it.

I would say, depending on how much you are willing to work on it or spend having it worked on mainly focus on structural soundness. Solid foundation, no weak wall, good roof, no hidden leaks.

[dustingthestars 9]

Thanks very much for your answers. Some food for thought!

She's going to check one that we really like with her father and step-father, both of them work in construction/maintenance to let them have the once over. I'm not over until July now, but if she's happy with it, I am too. It's just over $10000 and I have the cash ready to go.

Her father and step-father, plus countless other relatives, already buy houses like this, do them up and then flip them - they offered to help us out with what might need doing at VERY favourable rates - which is nice of them.

I kind of hoped that large costs would be more associated with finance rather than cash settlements, so it's refreshing to read about your experience.

Thanks again,