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422 Distressed Homes for Sale in Central Indiana

Looking for a bargain? Include foreclosures, HUD-owned, VA owned and bank-owned properties in your search. But be aware of potential pitfalls when purchasing this any of these types of property.

Here are a few things you’ll need to know before investing in any distressed property.

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While it is possible to find good foreclosure opportunities, contrary to popular belief, most foreclosure sales begin with a list price that is more than what the property is worth. After all, the bank’s goal is to satisfy all liens against the property, recoup attorney fees and other costs associated with the foreclosure process, and make a profit. So the price is usually anything but a bargain.

Occasionally, there is enough equity left in the home to make purchasing a foreclosure a good investment, assuming everything else goes right.

  • Possibility of finding a home with equity (rare)
Considerations & Concerns:
  • When you buy a foreclosure home you are getting the home in as-is condition. This means there could still be someone living there who has yet to move out or be evicted. And a lot can happen to a home in the meantime.
  • In addition to the primary mortgage (first lien), other outstanding liens can exist, from tax liens to second and third liens, mechanic’s liens, homeowner’s association (HOA) dues and more. You are inheriting these obligations.
  • Many banks will provide a pest inspection report if you ask for one. Your offer should be contingent on a home inspection.
  • If you are the winning bidder, then you will be required to pay the full bid by cashier’s check.

Bank-Owned Properties (a.k.a., REO)

When a property fails to sell at the foreclosure auction, it reverts back to the bank and becomes part of its real estate inventory. At this point, the primary mortgage is written-off as a loss, and the bank will negotiate with any remaining lien-holders and pay these off, in addition to any other HOA dues, mechanic’s liens, etc.

The first thing to realize about buying a bank-owned property is that the bank is never in a hurry to sell. Unlike an individual seller, there is no personal financial need to sell the home in a hurry. There is neither frustration nor desperation. Quite the contrary, the bank will act in a calculated fashion to maximize profit.

  • Possibility exists to find a home below market value.
Considerations & Concerns:
  • Offers and counter-offers are almost never handled in-person, but instead via FAX, email or some other electronic means.
  • Don’t be surprised if the bank’s counter-offer is not what you hoped. The bank’s counter offer must show to shareholders and auditors that the bank made a good-faith attempt to get the maximum, fair-market price. Only when this is not possible will the bank entertain a lower price.
  • Be prepared to make several counter-offers before an acceptable price can be reached.
  • Ask to see any and all reports, such as homeowner’s inspection reports, pest inspection reports, etc.
  • You will want to have the home inspected and appraised, but this will be come at your own expense.
  • Can ask that the bank make needed repairs, although they generally have no interest in doing so.

HUD-Owned Properties (a.k.a., REO)

The main difference between a HUD-owned property and a bank-owned property is that you are dealing with the federal government and not a private bank. When someone defaults on an FHA-insured mortgage, the lender forecloses on the home and then files a mortgage insurance claim with HUD. HUD then pays the lender what is owed and takes ownership of the property. HUD’s goal is to recover the amount of the mortgage insurance claim, and hopefully get a fair market price for the home.

  • Opportunity exists to purchase homes below market value
  • If the home meets FHA guidelines, qualified buyers may be able to purchase the home with an FHA-insured loan. Even if the home doesn’t meet FHA guidelines buyers may be still able to purchase it under FHA’s 203(k) Rehabilitation Loan program, which provides funds for the improvements in a single loan closing. The loan-to-value is based on the estimated future value of the home, with the repairs complete.
Considerations & Concerns:
  • HUD homes are sold as-is, and HUD will not pay to make any needed repairs. As with any home, buyers are strongly encouraged to have the home inspected and appraised.
  • Investors may bid on HUD-owned homes only after a period of time has elapsed, called the Exclusive Sales Period, at which point HUD will accept bids from all buyers, including investors.
  • Bids cannot be submitted directly by buyers. HUD uses private contractors, called “Marketing & Management Contractors” to manage its inventory. These contractors work with HUD-registered real estate brokers, called Local Listing Brokers, to accept bids, which can only be submitted by HUD-approved agents.

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243  Leerkamp  Drive, Franklin, IN 46131 243 Leerkamp Drive, Franklin, IN 46131 Add to Favorites
Subdivision: Southbrook  
If you are looking for something that feels like the "country" but want to be close to the convenience of town, this could be what you are looking for. Great neighborhood that has a very high pride of ownership. It backs to a cornfield, so nobody is behi...
4 Beds, 2 Bath Areas, 1782 SqFt
$118,000 (For Sale)
Red Oak Real Estate Group
89 East Tanner  Avenue, Spencer, IN 47460 89 East Tanner Avenue, Spencer, IN 47460 Add to Favorites
Subdivision: Spencer Heights  
3 Beds, 1 Bath Areas, 1100 SqFt
$29,900 (For Sale)
Valley Properties, Inc.
4933  Brehob  Road, Indianapolis, IN 46217 4933 Brehob Road, Indianapolis, IN 46217 Add to Favorites
Subdivision: Bixler  
Here's a value priced attractive stone ranch offering a large sunroom which overlooks a fenced rear yard with mature trees. Large living room, breakfast nook with built-in cabinet and a full basement. Some hardwood floors, large garage and immediate posse...
3 Beds, 2 Bath Areas, 1134 SqFt
$74,900 (For Sale)
CENTURY 21 Wilson & Associates
11961  Promontory  Court, Indianapolis, IN 46236 11961 Promontory Court, Indianapolis, IN 46236 Add to Favorites
Subdivision: Admirals Pointe  
Spectacular home in Admirals Pointe! The 2 story entrance to this 4 bedroom, 4 bath home greets you warmly with lots of light and leads into a formal living room and family with a fireplace. The open kitchen has an island for extra counter space and lot...
4 Beds, 4 Bath Areas, 3580 SqFt
$349,900 (For Sale)
The Wilmoth Group
60 Central Indiana Realtors to Open Doors
6841  Carlsen  Avenue, Indianapolis, IN 46214 6841 Carlsen Avenue, Indianapolis, IN 46214 Add to Favorites
Subdivision: Farleys Speedway Homeplace  
Amazing opportunity in Wayne township. This 3 bedroom 1 bath home is located in a great neighborhood with many much higher values. Take note of the large fenced rear yard and oversized rooms. The garage has been converted into what could be used as a 4th ...
3 Beds, 1 Bath Areas, 1421 SqFt
$84,900 (For Sale)
Wynkoop Brokerage Firm, LLC
1809 South Oakdale  Drive, Yorktown, IN 47396 1809 South Oakdale Drive, Yorktown, IN 47396 Add to Favorites
Subdivision: Homewood  
Cozy bungalow with 2 bedrooms and 1 bath. Fully fenced yard with storage shed. Great starter or investment home. HUD Case#: 151-700469 IE. HUD homes are sold As-Is. Information deemed reliable but not guaranteed.
2 Beds, 1 Bath Areas, 866 SqFt
$32,000 (For Sale)
Golden Rule Realty, LLC
1211 South Gibson  Street, Princeton, IN 47670 1211 South Gibson Street, Princeton, IN 47670 Add to Favorites
Subdivision: NA  
Property is offered as-is. This 1169 SQ FT 2 bedroom Princeton. Status "UI" insurability. “Plumbing failed to hold pressure at time of initial inspection. Due to this failure, HUD’s Field Service Manager will not permit the connection of water for the...
2 Beds, 1 Bath Areas, 1755 SqFt
$14,000 (For Sale)
Keller Williams Indy Metro S
232 West Broadway  Street, Shelbyville, IN 46176 232 West Broadway Street, Shelbyville, IN 46176 Add to Favorites
Subdivision: Miller & Mcrfarlands Add  
Check out this Historic Colonial Style 3 bedroom, 2 bath Home. This home is so Unique with so many Possibilities. Currently Zoned Residential but could possibly be Rezoned for Business/Commercial use(check with planning commission). Welcoming covered Fron...
3 Beds, 2 Bath Areas, 8210 SqFt
$174,900 (For Sale)
Home2Heart Real Estate,LLC
2321  Aspen  Court, Anderson, IN 46011 2321 Aspen Court, Anderson, IN 46011 Add to Favorites
Subdivision: Greenbriar  
3 bedroom, 1 bath, 1421 sq. ft. ranch home in Greenbriar with privacy fenced in back yard with patio in rear of home.
3 Beds, 1 Bath Areas, 1421 SqFt
$39,000 (For Sale)
Wood Realty Group
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338 West Pleasant  Street, Dunkirk, IN 47336 338 West Pleasant Street, Dunkirk, IN 47336 Add to Favorites
Subdivision: NA  
3 bedroom bungalow. Knotty pine walls in kitchen. Large living room with fireplace. Covered and screened porch. Separate laundry room. Covered front porch. 1 car insulated garage with an opener. Alley.
2 Beds, 1 Bath Areas, 816 SqFt
$40,000 (For Sale)
Property House GMAC
801 North Independence  Street, Windfall, IN 46076 801 North Independence Street, Windfall, IN 46076 Add to Favorites
Subdivision: Orchard  
3 bedroom, 2 baths, 1344 sq. ft. ranch home with detached garage, newer kitchen cabinets, laminate flooring throughout and gas log fireplace in living room.
3 Beds, 2 Bath Areas, 1344 SqFt
$55,500 (For Sale)
Wood Realty Group
8755 West Old Fort  Road, Fortville, IN 46040 8755 West Old Fort Road, Fortville, IN 46040 Add to Favorites
Subdivision: Old Fort Estates  
This 1,876 square foot property features 4 bedrooms and 2 bathrooms. This property was built in 1985. ALL INFORMATION DEEMED RELIABLE BUT NOT GUARANTEED. CASE NUMBER 151-827915. INSURED STATUS: UI.
4 Beds, 2 Bath Areas, 1876 SqFt
$42,000 (For Sale)
Atlantis Realty Group, INC
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