Government owned foreclosure properties can be found in Cincinnati, OH by checking the HUD and VA websites. RealtyTrac also maintains a list of government foreclosure properties. Homes are sold at substantial discounts because the government is not in the real estate business and wants to unload their properties quickly. In fact, Ohio ranks high in states where you save a substantial amount of money when you purchase a foreclosure. As of August 2012, you can save as much as 48% on purchasing a foreclosure home in Ohio. With savings like that, there is just no excuse not to purchase your Cincinnati bargain government property now.
What You Should Know About HUD Foreclosed Homes
HUD homes are homes that FHA borrowers defaulted on and which are repossessed by FHA lenders. Since borrowers are required to pay for FHA insurance in the event they default when they receive a FHA loan, the lender is paid off by HUD and HUD acquires title to the repossessed home. HUD then offers the home for sale. When you purchase a FHA foreclosure, you are getting a home at a substantial discount.
Here are a few things to keep in mind when purchasing a HUD foreclosed home:
- HUD foreclosed homes are offered to buyers who intend to reside at the home as their primary residence. If you are an investor, you still have an opportunity to purchase a home from HUD when no other bidders come forward that are buying the home as their primary residence.
- You may qualify for a FHA loan if you intend to use the home as your primary residence.
- Properties are sold in an as is condition. It is up to you to conduct your investigations.
- For buyers who intend to rehab the home, they may also qualify for a FHA 203(k) rehab and purchase loan.
- HUD only accepts full price offers made through a local Realtor.
- You only need a minimum 3.5% down payment.
- HUD may agree to pay your closing costs up to 3% of the purchase price. Be sure to have your Realtor ask for in the offer.
- HUD notifies the buyer whether the offer has been accepted or not by contacting the buyer’s Realtor within 48 hours after all offers have been reviewed.
- HUD pays your Realtor’s commission up to 6% of the purchase price as long as your Realtor requests the payment of the commission in the offer to purchase.
What You Should Know About Purchasing VA Foreclosed Homes?
VA foreclosed homes are homes that veteran borrowers defaulted on and which were repossessed by VA lenders. Like FHA, the VA insures the loan and pays off the lender when a borrower defaults. So these foreclosed VA homes also eventually wind up in HUD’s name and HUD offers them for sale as a foreclosure property. If you live close to a Military base, you have a higher chance of finding a VA foreclosed home. The VA has awarded a contract to Ocwen Financial Corporation, which manages all of its VA foreclosures and offers the properties for sale through various participating real estate offices.
Here are a few things to keep in mind when purchasing a VA foreclosed home:
- If you want to purchase a VA home, you must make your offer through a Realtor.
- Investors are encouraged to purchase VA homes as well.
- You may be able to obtain a VA loan even if you did not serve in the military. VA loans can be assumed.
- There are no mortgage insurance premiums.
- The VA also pays your Realtor’s commission up to 6% of the purchase price provided the request is also made in the purchase offer.
- Homes are sold in an as is condition without any warranties or guarantees.
- You will need to put down a $1,000 earnest money deposit.
- There are low down payments of 5% for investor non-owner occupied buyers and special Vendee financing programs available.
- The VA will pay up to 6% of the buyer’s closing costs if you put your request in writing when you make your offer.
- Closings must take place within 22 days after receiving VA vendee financing, and 30 days if you are a cash buyer or 60 days for all other financing.
- Buyers must conduct their own inspections and title searches.
Government foreclosed homes may need work so you are encouraged to have the home inspected. Some homes may be in poor or bad condition so take that into account when you make your offer. Homes that need major structural repairs or systems repairs may cost you a bundle of money to fix so you may want to look for homes that require cosmetic repairs only. Purchasing government foreclosure homes is a great way to find cheap properties that you can rehab and then lease out or later resell when with a high rate of return on your investment.
Government foreclosure homes sell quickly so if you find one that you want to buy, don’t hesitate because other buyers are competing for these homes. With low interest rates and affordable home prices, it is a great time to purchase a government foreclosed home in the Cincinnati area.
