How to Buy a Foreclosure
A foreclosure can be purchased with either cash or through financing.All offers must include a pre-qualifying letter from a lender or proof of cash funds for cash offers such as a bank statement.
To qualify for financing, you must apply with a bank or a mortgage lender.
You must have good credit with a credit score of at least 640.
There are three types of mortgage loans, a VA LOAN, an FHA LOAN, or a Conventional Loan.
The VA requires no down payment but you must have served in the military along with certain requirements.
The FHA Loan is best for first time home buyers and requires a 3.5% of sales price minimum from the buyer. This type loan requires the home to be almost in move-in condition. The home may have cosmetic issues. <Not all foreclosures (on my website) qualify for this type loan.>
The Conventional Loan requires 5% down and a higher credit score.
