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Posted by Ward-CA- on August 31, 2002 at 06:58:26:
In Reply to: Foreclosure in Ca posted by NIchole on August 30, 2002 at 17:12:09:
: I am looking for any info on buying foreclosures in Ca. My biggest question is can they by financed or do you have to pay cash up front??? Any advice will be appreciated.
: Thank you,
: Nichole in CA
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Nichole,
California requires that you must have the funds with you to cover your entire bid, at the time you make it, at the foreclosure auction.
To make sure you can meet the "all cash" requirement each bidder must qualify with the auctioneer, one by one, by showing her the total amount of funds they have with them in the form of cashier's checks or other acceptable forms of immediate payment.
If you attempt to bid more than what you brought the auctioneer will stop you.
So the requirement that one has to pay all cash up front at the auction makes it tough to get financing, which usually requires compensating security up front before a loan is made.
Basically you have to find an investor who will give you the money to buy a foreclosure without any immediate security, hoping you'll buy a good deal with her cash instead of absconding with it to Rio. That type of investor has to know you quite well, or know someone they know quite well who can vouch for your integrity and honesty.
So raising cash is a skill you need to develop that's as critical as developing the other unique skills to successful foreclosure investing, such as expertly doing title research at the recorder's office, determining precisely where to stop in your bidding at the auction, accurately predicting your resale values, etc.
Hope this helps.
