I'm looking into purchasing my brother-in-laws' townhouse, which we originally thought was only in pre-foreclosure (I'm still not clear on how it got this far without them realizing it, but that's an entirely different conversation).
I met with him today to take a look at the notices they've received and it is a Notice of Sale, which from what I understand is essentially the last step before auction. It lists the auction date as 06/01/2024, so there's plenty of time for me to close on a loan before then. To stop the foreclosure, they must pay $31k or sell.
I'm very new to the investing side. I turned my original home into a rental and have been successful with that for the last 2 years. This is the first investment loan.
I'm pre-approved with LoanDepot and BetterMortgage for purchase price of $210k with estimated value of $290k at 7.125% with a 25% down payment and working on a pre-approval with a credit union for 5.5% and 25% down. I'm still shopping sound, but the majority seem to be in that 7.125% range except that credit union.
The only issue with the credit union is that they said it's fine if it's still in pre-foreclosure, but they can't finance it if it goes to foreclosure. Any idea why it makes a difference? If my financials are strong (17% DTI, 770 credit score, and plenty of income) and we get the foreclosure put on hold/extended, why does it matter?
Any idea if the fact it's in foreclosure with an auction date will be an issue with other lenders?
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source https://www.reddit.com/r/RealEstate/comments/1b20p7v/buying_home_in_foreclosure/
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