Many people avoid short-sales because they are frustrating. This means that there is somewhat of a feeding frenzy around bank-owned properties. Its important to know that these can be difficult transactions as well and make sure the buyer is prepared to handle it.
Here are some of the things that are important to know in a foreclosure transaction.
- Try to see the property as soon as it gets on the market because the more desirable properties may end up with multiple offers.
- Some banks will not review the offers right away but will wait for the home to be on the market for a few days.
- Make your highest and best offer because many banks will not accept escalation clauses.
- Once the offer is accepted banks do not like to make changes and will make it very difficult (trust me, I learned this the hard way).
- Homes are sold "As-Is". Banks will rarely make repairs.
- Many banks will make the buyers pay to have the home de-winterized for the inspection.
- Make sure that the closing date you agree to is realistic because many banks will charge a per diem charge for every day after the originally agreed upon closing date.
- Many banks will make it extremely difficult for the buyer to choose their own title company.
Foreclosures can be great deals. However, you are not dealing with individual sellers but instead with a corporation that can make it also stressful and frustrating.
Pack your patience and it can be incredibly worth-while in the end.
Dr. Stacey-Ann Baugh
Long & Foster Real Estate
www.staceybaugh.com
staceyannbaugh@gmail.com
240-481-3565 (C)
301-924-1100 (O)
FINALLY! A DOCTOR WHO MAKES HOUSE-CALLS!
Also, try to find out exactly what the bank wants when you submitt your package along with the offer.
I find foreclosures to be very desirable when compared to short sales.
I agree, I would rather work with foreclosures than short sales any day.
Stacey Ann, The foreclosure process seems to be more consistent than short sales. Give me a foreclosure any time over a SS. Rich
Hi Stacey Ann, the fact that foreclosures are easier than short sales aptly illustrates why we are still caught in the giant foreclosure machine. Will it ever end??!!! Great post, with good information! Thanks Stacey-Ann!
I think communicating realistic information about the transaction is very important. Great post!
Rich - I agree
Mary - I'm hoping that it will be coming to an end soon.
Rebecca - Thanks
Stacey-Ann - This is great advice! It's good to inform the buyers as to what they should expect. :)
Beware of that false sense of security. They all seem rosy till the last few days till settlement. I have 3 REO's stacked up waiting due to title issues!