Home BuyingBudget & Finance

Buying a House in Foreclosure

My daughter is thinking about buying a house in foreclosure in New Mexico. Does anyone have ideas about what she needs to think about or do before making an offer?

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By mary gwost from St Paul, MN

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September 19, 20090 found this helpful

I think I would consult with a attorney that specalizies in foreclosures. One thing to be aware of is foreclosed homes usually have back taxes that are owed. So if your daughter closes on a foreclosure house there may be alot of back taxes that have to be paid when she takes ownership.

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September 19, 20090 found this helpful

foxrun41 - in most states that is not the case. A lien would be filed on a property and the owner, in this case the bank, is responsible for taxes or other monies owed on the property. In Colorado you can't sell a house without a clear title and if there's some "surprise" you are covered by title insurance.

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More on title insurance (though brief) here:
www.mortgageqna.com/.../title-insurance-underwriter.html

As for a foreclosed home. Some of the problems might be: hidden structural damage, plumbing, electrical, etc...those things are usually disclosed buy the seller and the seller's agent but in a foreclosure the owner (bank) may not know these things.

There are some good articles out there if you google "buying a foreclosed home". This was the second link and since it's from CNN and This Old House, should be good for basic information:
www.cnn.com/.../index.html

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September 21, 20090 found this helpful

Talk with a Real Estate Agent. They will know how to guide you. Also usually a Foreclosure is usually sold as is.

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However, I do think you are allowed to get an inspection. It may depend on the state you live in. Good Luck!

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