1st timer, found a great REO property...now what?

Quote from Brian1 : To find a good home inspector, do not use the home inspector your real estate agent recommends to you. They often use inspectors who are soft on reports and who they know they won't kill the deal. You don't want one of those inspectors. You want someone who takes pride in finding every single little thing wrong with that house..

As someonewho use to be in the business, i'd have to disagree. A good Realtor wants a happy client, it leads to future business from that person and their friends. Bad things in a inspection report doesn't necessarily mean the deal will not go through, any problems are almost always fixed by the seller or you can try and get a credit from them (more likely in a REO situation) to fix them.

Quote : Also, never buy a home warranty as a buyer. They aren't worth the paper they're written on.

Again, i'm disagreeing here. Its always a good idea to get one as you have no idea how the house was treated or maintained. A 1 year warranty lets you run the house for a while and identify problems. And with an old house like the OP is talking about, there are probably lots of old things which are about to expire. A warranty costs about $400, he already said the water heater looks old......how much does one of those cost? I've seen clients save thousands because of one of these. Just be sure to shop and compare as some will not cover certain things or are upgrades.

Here's a question: I make about 55k and she makes about 20k, I have no debt and she has about 10k in student loans. Would I be better off applying individually when it comes time or is her income worth adding to the equation despite the debt?

Quote from CbusGuy : Here's a question: I make about 55k wit and she makes about 20k, I have no debt and she has about 10k in student loans. Would I be better off applying individually when it comes time or is her income worth adding to the equation despite the debt?

When you apply the mortgage person will tell you. My wife was on the application, but we took her off the loan because her score brought our average down a bracket which meant a higher APR and i didn't need her income to qualify.

Its all going to be based on your score and hers.

I wouldn't touch this.

Is the plumbing pvc and is the electricity fuse box or breaker box? What amp is it? What type is the actual electrical wiring, K&T, etc...?

Upgrading those are serious time and money if you live in a permit happy city.

OP,
Couple things.... And I'm speaking from experience so message me privately if you need to know what kind of experience.
1) find out if the neighborhood has a historical society which oversees the codes and regulates the permits. If they do, bring someone from it in, ask about the home. They will often be more knowledgeable of the homes history than anyone else...this is also a good time to casually ask what they think needs work and to mention any aspirations you have with the home. For example, if it has wooden , custom built windows and a few need replacing, something as simple as the can be a real headache with a historic society watching.
2) hire very specific inspectors. This should include a general home inspector, a foundation inspector or structural engineer, and a heating/ac/plumbing expert. A general home inspector only sees the obvious issues.
3) get at least two bids to fix each of the " must do" items in need of repair. Take lots of pictures.
4) if the bank has the utilities on, get your realtor to casually ask what the water and electric has been running. While its not an accurate depiction of what it will run when occupied, its can be an indication of issue...and further, an indicator of whether or not you can afford this place.
5) still want it? Make your offer. That's right , I just encouraged you to do all your inspections prior to making the offer. When you present the offer to them, share all your diligence. Inspections, pictures, bids...all of it. Resist the urge to embellish and say typical invesor/real estate shark things like " we're willing to take this off your hands "... Rather, accompany your offer with a written explanation that you and your spouse want to homestead here, raise your family, improve the neighborhood, but have to be realistic about the costs you will incur. This way, you can write an offer that is not contingent on inspections, meaning there is less chance of you not closing. They like that.

Should the listing agent not allow inspections prior to a written offer, write a letter of intent at full list price, sign it, and request to inspect for 10 days. This leaves nowhere for the seller to accept and the door wide open for your full offer.