Yet another housing advice thread

[Irrelevant Dude]

I have been searching for a house on and off for about the past year, and a few months ago I noticed a decent-looking brick ranch for sale for $130,000. I'm pre-approved for more than that amount, but really didn't want to spend that much so I waited... this past week I saw that the listing had been reduced all the way down to $99,900. I immediately called the realtor and went to look at the house tonight. I found out that the reason for the price drop is that the house is on the verge of going to foreclosure and the bank just called them and asked them to drop the price.

Upon walking through the house, I found it to need a lot of work... some drywall, floors, ceiling, garage door, and landscaping, BUT at the same time the house has a lot of potential to increase the value once that work is completed.

I'm now considering what to offer. Initially I was thinking of offering around $91,000 thinking the bank will probably accept whatever they can get to prevent foreclosure, but I keep wondering what the other offers are and if I really want to lose a house over a few thousand dollars which equates to literally $10-$20 a month. Now I'm thinking maybe I should offer closer to the asking price, but then I wonder if maybe the other offers are really low and I could just be outbidding myself.

Does anyone have any advice for the offer? In addition to that, I'm going to need extra money for the repairs, estimating approximately an additional $10,000 that I will need loaned to me. I'm already going to be borrowing 100% of the cost, so will a bank even loan me additional money? If not, how would I be able to get it at a reasonable rate?

And to top it all off, I need to get my offer in by Monday. If anyone has advice for me I would greatly appreciate it. Thanks!

[Franklinnoble]

It really depends on the market in the area. Ask your realtor to run some comperables... or maybe even get an appraisal done.

In my opinion, you can't go wrong either way. They can accept the offer, or counter. Or they get a full price offer, and you're out of the deal.

It all comes down to how hot the housing market is in your area.

[Irrelevant Dude]

The market in this area was very good, but has cooled down somewhat. I had a realtor tell me that houses are generally selling for somewhere around 89% of the asking price, but I don't know if that necessarily applies to a house that is on the verge of foreclosure. I was also told that since this is going through a bank there would most likely be no counteroffer, so that's the part that makes me the most nervous when trying to determine my offer.

[cubboyroy1826]

Find a realtor you can trust who will give you the real value of the house. There are several companies that require no seasoning to take out a second mortgage for home imporvements and go off of the appraised value. Buy today at 99k and if the house truly can appraise at say 120k you can borrow up to the 120k with either an equity line (wouldnt recommend in the current rising rates market) or a fixed rate 2nd. You can take the fixed rate 2nd all the way out to 30 years if need be. To get a decent rate on the second you will need to have a credit score close to or over 700. FYI the monthly payment difference on a 30 yr fixed at 7% is about $7 per 1000.