How To Buy a Foreclosed House With No Credit

When a house is foreclosed it typically goes up for auction. If the house does not sell at auction, the lender will normally list the house with a real estate professional. When buying a house at auction you may be required to show proof of funds. When making an offer on a foreclosed house after the auction process, you will need to be pre-approved with a lender. Often the lender that is selling the house will require you to be approved with it, prior to making an offer. This does not mean you will need to obtain a loan from the lender selling the foreclosed property, but it does mean you will need credit to obtain a loan.

Instructions

1. Evaluate how much cash you can raise. Without credit, it will be virtually impossible to qualify for a mortgage without first establishing credit.

2. Look for foreclosed houses in the price range of the cash you can raise.

3. Inform your real estate agent, or the one listing the property, that you will be paying cash for the purchase.

4. Show proof of funds. When making an offer to purchase a foreclosed home, you will need to be able to show proof of funds to the seller. Each lender may have its own requirement as to what is needed for proof of funds.