Foreclosure Purchase Checklist

Fannie Mae and Foreclosure Purchase Checklist




  • Check the listing at the property tax records to see if the property is owned by a bank
  • Have the longest possible closing date possible (2 months)
  • To get a mortgage pre-approval, you will need the following scanned into PDF's to email to your bank:
  1. copy of the purchase agreement 
  2. list of properties that you own currently and where what financial institution is providing the loan 
  3. 2 months worth of most recent banks statements 
  4. employment contract 
  5. 2 months worth of current w2's 
  6. 2 years worth of recent tax returns 
  • Check with your current bank if they offer standard mortgages to properties that need repairs. If they don't (Big Banks will not), ask if they offer renovation loans. 
  • Small banks are more likely to negotiate a standard mortgage for a property that requires repair. An estimate of the repair is submitted, the amount of which will be put into an escrow account before closing; thus insuring there will be enough money to repair the house. You will be required to pay this amount UP FRONT, before closing.
  • Remember an email stating the terms of the loan is not binding. Only a signed document called a Loan Disclosure/Lock-In Agreement is binding. 
  • Look for a property insurer. Rates decrease dramatically if you also include your autos with your property insurance. 
  • Find a general contractor who will do roofs and other repairs and a window repair/replacement contractor BEFORE you look for a home. Ask them if they are willing to provide a social security number for a background check
  • As soon as your offer is accepted, ask the contractor(s) to visit the property for a quotation
  • The week of closing, the contractors will be signing another set of forms. Make sure the contractors are in town to sign. 
  • Fannie Mae only accepts a wire transfer for their money. They do not accept certified checks. Please note that it takes about 3 hours for the money to be wired to Fannie Mae's bank (your bank, lawyers bank to Fannie Mae's bank) and Fannie Mae closes for business at 4 PM sharp.
  • Do not trigger any credit checks by applying for a credit car, purchasing a car (or other vehicle), or refinancing your home. This makes underwriters very nervous and could cause your bank to pull your loan at the last minute.


If you are considering to rent your property:


  • Estimate how much rent you will be earning from property (use Zillow.com and Craigslist.com)
  • Purchase a large (1 to 3 million) umbrella policy for your rental properties. Your current insurer may be able to provide you with an umbrella policy. 
  • LLC's
  1. It's relatively inexpensive to register and you do not need a lawyer. 
  2. Some lenders will not provide standard mortgages to LLC's
  3. Property insurance for LLC's is more expensive. Many insurers do not insure LLC's.
  4. LLC's do not protect you from personal or financial liability, it's just a management tool. 




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