Contact your realtor to search the multiple listing service for all rentals in Danville. She will also be in contact with the property managers in the area for a fresh list of rentals. some of these homes may be pre foreclosures but of course, this will not be public knowledge.
Owners living in a home that is being short saled or eventually foreclosed will usually want to live in their home until the last day.... more
Before bidding, I would recommend request a title search of the property to see what other liens might be recorded against the property. i.e, mechanics liens or subordinated liens that you might be purchasing the property subject to. These will need to be paid in addition to the sale price. You also want to drive by the property to verify occupancy. If you take title to a property where a tenancy at sufferance exists (a home owner who refuses to vacate), you could be in for a battle, costing you time and money, thereby reducing your ROI if the purchase is intended to be a flip because of the increase holding costs. If access to the property is possible, I would walk through it to verify condition. Sometimes, a walk through is not available and you take your chances that the foreclosed upon home owners have or haven't destroyed the interior which you can't determine from a drive-by. Finally, you need to have cash to close at the Trustee's Sale. If the loss on the property is significant, be prepared to be 'outbid' by foreclosing lien holder who is seeking to repurchase the asset and mitigate their losses, otherwise known as an REO.... more
The banks always have a minimum bid and itâ€™s normally the amount of the balance of the mortgage they hold on the property. I have never seen a property go for 1 dollar. And what kind of property is it that bring a $4000 deposit?... more
A short sale is very different from a bank-owned property. For example, the list price of a short sale home may be 'wishful thinking'. The seller may list his home below market, and he may even accept an offer lower than the list price. It really doesn't matter to the seller what price he accepts because he will not get any money from the sale anyway. Once the seller accepts and offer, the lender must approve the sale's price because it is the lender who is taking the loss. This is where problems can arise...
One of my co-workers was following up on a short sale with B of A . She has been working with the lender for the past 3 months and thought things were going well. The appraisal was completed and came in at the contract price. Nevertheless, when she called to get an update, she received a recorded message that said the short sale had been cancelled. When she finally went through the 'phone tree' and got a live person on the phone, she was told that a new person assigned to the case decided the 'price was insufficient' and cancelled the transaction. There are Three important lessons here: First, this lady is a great real estate agent and was staying on top of the transaction. If she hadn't been so diligent in her efforts, none of the parties involved would have been notified that the transaction was cancelled. The buyer would have been waiting and waiting and waiting--all for nothing. The seller would have been caught unaware that he was getting closer to foreclosure because the sale was cancelled. The second lesson is that things can change very quickly and unexpectedly in a short sale. There are no guarantees you will close the escrow. And third, short sales are not necessarily the great bargains people think they are.
With a bank-owned property, you are buying directly from the bank. The bank wants to maximize it's return and may use different approaches to reach their goal. One approach is to test the market (much like many sellers) and start with high list price for a couple of weeks to see if they get any interest. Often they will decline an offer that comes in more than 5% under their asking price. If they don't receive any offers within a certain amount of time, they will reduce their price and begin the process again, until they get an offer within 5% of their asking price. And yes, sometimes they wind up turning down an offer in the beginning and selling for less later on. Often times, it doesn't make sense, but it is the formula they use and they stick with it.
Some banks use the 'silent auction' approach. That means they list a property at an EXTREMELY attractive price and let buyers create a bidding war. The property then sells for way over asking price. In either case, the price of these properties may be slightly below market to justify the risks involved in buying a property without any disclosures or recourse against the seller.
I didn't mean to write a book, but there is so much confusion out there that I felt it needed clarification. Ofcourse, there is so much more to discuss. I am sure others will add their 2 cents worth.... more