As some of you know, I've been looking for a house to rent, but craigslist is overrun with all of these "preforeclosure listings" for stupid prices. Most of this appears to be pie in the sky bullshit, but I must confess that I'm pretty ignorant about the state of mortgages and lending institutions regarding real estate right now.

What in the fork IS the deal, and should I even remotely entertain the thought of checking these out and possibly buying?

3/10/2009 3:00:29 PM

I wouldn't, heck even renting a house from someone puts you in severe risk of being evicted because they were foreclosed on.

In fact, a lot of people are moving out to cheaper rentals and hoping to rent their house out to others to prevent foreclosure, which isn't exactly working.

Just be careful.

3/10/2009 3:08:44 PM

My wife and I are currently looking at houses and the way I understand it, a preforeclosure is a property where the owner is behind on their payments and knows that a foreclosure is immenent. It is in the owner's best interest to sell, even at a huge discount, in order to save what little equity they have from being eaten up from the foreclosure process. As the foreclosure day draws closer, the price usually falls more.

Basically the bank has or is in the process of foreclosing but hasn't siezed the property yet.

[Edited on March 10, 2009 at 3:12 PM. Reason : ]

3/10/2009 3:11:22 PM

Very often, the bank will allow the homeowner to sell the home for as much as he can get and then apply all of that to what is left of the principle and call it a deal. It saves the bank from having to deal with holding/fixing damange/selling, it keeps a black eye of a foreclosure out of the neighborhood (though the decrease in home price to unload the property has a similar effect, and it keeps the homeowner from getting dinged on their credit.

3/10/2009 3:22:52 PM

^ i.e., a "short sale"

3/10/2009 4:55:59 PM

But on Craigslist? That's where the line gets shady.....

3/10/2009 5:53:27 PM

yeah, its basically a short sale.

i'm thinking seriously about getting in while prices are low and taking advantage of the $8k tax credit. Hopefully I will remain employed long enough for the economy to recover. If I buy a place, it will be the riskiest thing I've ever done, financially. I'm torn between looking for a place with the best ROI and a place that I really like.

The other option is keep living in the stupid apartment (which I hate) and buying a motorcycle I(which would probably get stolen)

[Edited on March 10, 2009 at 5:56 PM. Reason : .]

3/10/2009 5:56:09 PM

I'm contemplating this too, but I haven't found a property that I like yet. Most of them are in shitty neighborhoods or in shitty condition or both. The ones that are nice are still priced too high. I guess a wait and see attitude is appropriate.

It seems like a good investment over the long run.

3/10/2009 8:07:34 PM

hahaha you guys looking for deals with your chump change.

there's a reason they say "the rich keep getting richer" ...

3/10/2009 9:21:41 PM

Yeah, all I have is chump change. I'm just looking for a place to live.

3/10/2009 11:10:58 PM

i closed on a foreclosure yesterday. yay.

3/10/2009 11:15:21 PM

Now probably isn't the time to burn cash you don't have.

3/10/2009 11:17:29 PM

Have no choice but to burn SOME cash. I need a place to live.

3/10/2009 11:38:49 PM