Borrow cash if you can
You've heard it many times: Cash is king. When buying a foreclosure, there's no question that a cash offer is a key tool to snag a bargain.
For buyers who need mortgages, it can take 30 to 60 days to close on the house after the offer is accepted. The transaction can go more quickly when the buyer pays cash.
"A cash buyer who can close in 10 days can certainly get the best deal," says Ron Peltier, chairman and CEO of HomeServices of America, a real estate brokerage in Minneapolis.
If you are like most buyers and don't have a fat savings account to pay cash for a house, consider borrowing from a relative. You can secure a mortgage after the deal is closed to repay the loan. But only do that if you know you will be approved for a mortgage.
Peltier says he knows of many buyers who borrow from family or friends to grab good deals.
"We are seeing that a lot," he says. "If you can close quick and your offer is not contingent on financing, (the bank) might be able to adjust that purchase price by 5 percent or more for a quick closing."