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03-16-2005, 10:27 AM
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#1 |
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Mega Moderator
Join Date: Dec 2001
Location: Lenexa, KS
Age: 31
Posts: 9,052
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foreclosure homes? anyone have any purchasing experience?
Been looking for homes in the KC area. The more people I talk to, the more I realize I should spend less $$ than what I want too and buy a house in the "marketable" segment if I plan on selling quickly. That's $150-200 here. Homes above 200 don't sell fast, I'm really looking to get a fixer-upper foreclosure and sell it within a year for a small profit.
Any comments/ideas/suggestions? (i'd prefer responses from people /w actual experience doing this)
__________________
"Give a man fire, and he'll be warm for a day; set a man on fire, and he'll be warm for the rest of his life." 2005 Redondo Red Perl TL , 6MT, Navi -SiGGy |
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03-16-2005, 10:29 AM
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#2 |
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Stay or leave
Join Date: Jul 2003
Location: Orlando, FL
Age: 28
Posts: 1,222
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no experience but would like to hear what people say, i'm in the market of buying and am definitely open to options.
On a side note, have heard weird things about foreclosures, sometimes people sabotage the house before they get kicked out, like ruin shit I mean. Guess you'd have to look into that. |
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03-16-2005, 10:47 AM
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#3 | |
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Moderator
Join Date: Dec 2003
Location: Long Beach, CA
Age: 45
Posts: 20,053
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03-16-2005, 11:53 AM
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#4 |
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Sumthin Sumthin Darkside
Join Date: Feb 2002
Location: Miami
Age: 30
Posts: 6,680
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I hope your handy. Repairs can get pricey. I've heard of people scratching up tile, unloading anything nailed down, basically leaving the walls and somewhat of a roof.
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03-16-2005, 12:17 PM
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#5 | |
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Stay or leave
Join Date: Jul 2003
Location: Orlando, FL
Age: 28
Posts: 1,222
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03-16-2005, 12:18 PM
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#6 |
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THE Florida Gators.
Join Date: Apr 2002
Location: Jacksonville, Florida
Age: 31
Posts: 4,718
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This wasn't a forclosure, but a "fixer-upper"... My Dad & I are closing on a house in about 2 weeks that is worth around $475-495K. It is located in a gated community, which has waterfront houses, and a huge wildlife preserve. We purchased the house for $350K. It is a 5-6BR/3.5 bath & is about 3500sqft.
The yard is completly ruined, and the interior has been destroyed by the mom that lived there, and her FIVE kids. I own a landscaping company, so the outside will be fairly cheap & easy.... On the inside, we are fixing all of the holes in the walls, and then having the entire house repainted in nuetral/earth tone colors. All of the carpet is coming up, and the whole house (minus BR's) is going to be 18" tiled. The BR's are going to get berber carpet put in. New lighting fixtures are going in, as well as vinyl plantation shutters (which I get at wholesale, but is probably the most expensive part of the restoration). Anyway, we hope to sell the house within 6-9 months, and make between 35-45 thousand each after all is said & done, that is giving an estimate of $50,000 to completly redo the house, inside & out. It will probably be less then that because I own the landscaping co, which will take care of the outside, I also will do all of the pressure washing, and de-fungus the roof by myself & my laborers. My dad & I will also lay all of the tile & carpet, as well as the drywall work. Basically the only thing that we are subbing out is the painting, which will be done by a friend of ours for $2500. All said & done, we should make a nice chunk of change off of it...  |
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03-16-2005, 12:24 PM
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#7 | |
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Mega Moderator
Join Date: Aug 2002
Location: Swansea, MA
Age: 42
Posts: 32,285
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Siggy, if you fix it up and resell within a year, you'll have to consider how taxes will affect your profit:
http://www.irs.gov/publications/p523/ar02.html There's a couple of threads in M&I about capital gains: from http://www.acurazine.com/forums/show...=capital+gains Quote:
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03-16-2005, 1:09 PM
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#8 |
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Moderator
Join Date: Jun 2004
Location: Philadelphia, PA USA
Age: 59
Posts: 4,227
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A couple can be exempted from capital gains from the sale of one property for $500K or less for a maximum of five years, so long as, in that time, another primary residence is purchased. It has to be a primary residence, and cannot be property purchased for investment purposes. Have just gone through this with my accountant.......
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03-16-2005, 1:37 PM
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#9 |
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Sumthin Sumthin Darkside
Join Date: Feb 2002
Location: Miami
Age: 30
Posts: 6,680
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Why not rent out vs selling?
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03-16-2005, 2:01 PM
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#10 |
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mushroom mushroom
Join Date: Nov 2001
Location: az
Age: 28
Posts: 1,571
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I heard a very bad forecloseure story that happend about a year or so ago. This guy knew that he was going to get kicked out of his house so he decided to screw with the structural integrety of the house. Apparently he took a circular saw and ran it across every wall in the house cutting though the drywall and through all the studs, ect. He then patched up the dry wall to make like nothing happend. Needless to say then next owner had a handfull.
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03-16-2005, 2:15 PM
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#11 | |
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mushroom mushroom
Join Date: Nov 2001
Location: az
Age: 28
Posts: 1,571
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Quote:
In Arizona you can avoid capital gains every two years. If you are single it is $250k or less and if you are married it is up to $500. Must be primary residence You can also divert paying taxes on capital gains by doing a 1031. In general you take the money form the original investment and dumping it into a new investment. The property can not be your primary residence, and is must be an investment property. If you sell one property you have I believe 45 days to identify the new property and then you have 180 days to close on escrow. Last edited by bug230; 03-16-2005 at 2:17 PM. |
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03-16-2005, 2:21 PM
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#12 |
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Evolution IX > sTi =P
Join Date: Mar 2001
Location: Los Angeles, Ca
Age: 27
Posts: 2,941
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If you do your research it is possible to find a foreclosure house. One of my close relatives found a condo on the Wilshire corridor in Westwood and it has almost doubled in value over 10 years.
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03-16-2005, 2:25 PM
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#13 | |
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Mega Moderator
Join Date: Dec 2001
Location: Lenexa, KS
Age: 31
Posts: 9,052
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Quote:
I'm at a loss, so basically they didn't pay off their part of the loan and now they are trying to screw someone that didn't do anything to them? Doesn't make sense to me... someone explain this to me. |
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03-16-2005, 2:32 PM
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#14 | |
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Registered User
Join Date: Jan 2001
Location: West Covina, CA
Age: 57
Posts: 2,327
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03-16-2005, 2:33 PM
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#15 | |
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mushroom mushroom
Join Date: Nov 2001
Location: az
Age: 28
Posts: 1,571
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03-16-2005, 2:41 PM
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#16 | |
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misanthropist
Join Date: Aug 2003
Location: Tyson's Corner
Age: 27
Posts: 1,699
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Quote:
licencee??? i gots my drivers licence 2... i have read a lot about foreclosures but they can very dangerous, people become very agitated about their situation as described above, and you can have other big problems with 2nd and third mortgages on the house that aren't being disclosed, you will want to pay for title searches... getting rid of the people who are living in the foreclosed home can also be a big pain... if you have a good relationship with your bank or credit unions try to ask about REO's... real estate owned, which means a bank held foreclosure... you generally don't get as good of a deal, but you probably don't have to deal with the chances of a lot of headaches... technically I don't have any experience in foreclosures, but I just bought my second condo here in the Nova area which I plan to rent out... and I learned all I know about the whole real estate thing by sitting on the floor for countless hours at Barnes and Nobles and reading until I found the books that I felt adequately explained everything I wanted to know... if you are interested I can recommend a few titles when I get home... it isn't easy to do, but if you have some up front capital to play with it can be very profitable... just don't forget your entire realm of costs, money down, closing costs on the loan, probably a slightly higher interest rate on an investment loan, capital for fixing it up, realtor costs on the back end, and then your capital gains hit unless you do a starker exchange (1031) and then you HAVE to put it back into equal or more expensive property regardless of how long you hold it Some people also interpret the 1031 law differently as to whether or not you have to have rented out the property and for how long in order to use that loophole but it probably depends on your cpa.... good luck! Last edited by 03typeS6spd; 03-16-2005 at 2:45 PM. |
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03-16-2005, 2:55 PM
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#17 | |
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misanthropist
Join Date: Aug 2003
Location: Tyson's Corner
Age: 27
Posts: 1,699
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Quote:
wow, i feel dumb, didn't know that was a real spelling! licencee n : someone to whom a license is granted [syn: licensee] i thought it was just 3 entries found for licensee. li·cens·ee ( P ) Pronunciation Key (lsn-s) n. One to whom or to which a license is granted. whoops!  |
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03-16-2005, 2:56 PM
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#18 | |
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mushroom mushroom
Join Date: Nov 2001
Location: az
Age: 28
Posts: 1,571
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03-16-2005, 4:26 PM
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#19 |
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Got da Internet Goin Nutz
Join Date: Oct 2001
Location: P-VILLE, TEXAS
Age: 32
Posts: 2,012
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I just bought a fannie mae owned bank foreclosure a month ago (my first house). The house was in the best condition of all of the houses we looked at. I did make sure to get a one year warranty just in case anything popped up. So far we have had to change the heating coil in the water heater to the tune of the $50 deductible but that is it. The original owner left all of the appliances and a refrigerator. The house was just built in '00 so it is practically still new. Just do your research, get an inspection, and get a warranty.
On a side note one evening a couple of weeks ago, there was a knock on the door. It was the original owners ex-wife (middle aged hispanic lady). Seems that they were going through a divorce and she didn't even know that he had moved out of the house. She had two black guys with her and she was asking if she could get some of her stuff out of the garage. I told her, I'm sorry lady but this house and everything in it are now mine! She was visibly upset, stormed off and left! I am happy I have ADT! |
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03-16-2005, 5:43 PM
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#20 | |
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Mega Moderator
Join Date: Jan 2001
Location: Santa Clarita, CA
Posts: 8,345
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03-16-2005, 6:20 PM
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#21 | |
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Mega Moderator
Join Date: Dec 2001
Location: Lenexa, KS
Age: 31
Posts: 9,052
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03-16-2005, 7:50 PM
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#22 |
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Sumthin Sumthin Darkside
Join Date: Feb 2002
Location: Miami
Age: 30
Posts: 6,680
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What was in the garage that she had?
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03-17-2005, 12:12 AM
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#23 |
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Got da Internet Goin Nutz
Join Date: Oct 2001
Location: P-VILLE, TEXAS
Age: 32
Posts: 2,012
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She was babeling (sp?) about a lawn mower and some other stuff. There was honestly nothing in the garage though. I am sure the listing agent helped himself to it.
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03-17-2005, 11:14 AM
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#24 |
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Sumthin Sumthin Darkside
Join Date: Feb 2002
Location: Miami
Age: 30
Posts: 6,680
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I would've told her that, so that they don't jack you.
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03-17-2005, 11:47 AM
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#25 |
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Got da Internet Goin Nutz
Join Date: Oct 2001
Location: P-VILLE, TEXAS
Age: 32
Posts: 2,012
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