Foreclosure in Warrington>Question Details

Matt Gleave, Home Buyer in 19020

Do foreclosures really offer great value? If so, why doesn't everybody look to buy a foreclosed home?

Asked by Matt Gleave, 19020 Wed Apr 22, 2009

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9
Foreclosed homes can be a good deal but you need to know what you are getting into. Bank owned properties are sold as is which means when it comes time to a home inspection report and something is wrong, you must pay to fix it. There is no negioation.


Sean Dawes
Long and Foster Real Estate Inc.
Web Reference: http://www.SeanDawes.com
1 vote Thank Flag Link Wed Apr 22, 2009
Foreclosures "can" offer great value, but no one knows for certain until the sale closes. Foreclosures are sold as-is, and most of the time you are taking a risk in not knowing what is wrong with the property. If there is a hole in the wall, you can see that and estimate on time and money to fix it. What about if there is something wrong with hidden plumbing, faulty wiring, etc. In the many REO sales I've been a part of, there were no big surprises (thankfully). However I know of several big surprises that made things extremely difficult for the buyer after closing.
0 votes Thank Flag Link Thu Sep 30, 2010
Foreclosures and short sales do usually offer much better value that non distressed home sales. However, they are typically "as-is" sales, and many regular home loans require the property to be in decent condition prior to closing. There is also the uncertainty and difficulty of working with a lender, they are in the money lending business, not the property management business.
0 votes Thank Flag Link Thu Apr 23, 2009
Matt as you can tell from the responses to your question there are a lot of different feelings when it comes to distressed properties(foreclosures, REO, and shortsales) its all in how you percieve the situation. I will say that there are plenty of distressed homes on the market today. we are not in dire straits like some other areas of the country, but there are definetly deals to be found. You'll need an experienced agent to help guide you through any of the different scenarios when buying distressed properties. I have helped clients buy and sell shortsales, foreclosed and bank owned homes. experience really does matter when it comes to these types of properties. Some agents are not familiar with the processes and they are likely not prepared to handle the additional work required.
it's estimated that 40-50% of homes for sale this year will be shortsales or foreclosures.

Dennis Strange
RE/MAX Premier
267-767-8558
0 votes Thank Flag Link Thu Apr 23, 2009
The forclosures in this area are few and far between. The banks are not letting them go for much less than market value in all of the properties I have seen. Other areas of the country are different, however. It would be better to consult a Realtor who carries the ABR (Accredited Buyer Representative) designation to assess your particular situation.

Tina Walsh, CRS, ABR, e-PRO
Class Harlan RE
215-348-8111 x 24
215-669-0439 (cell)
Tina@PAHomeShop.com
Web Reference: http://www.PAHomeShop.com
0 votes Thank Flag Link Wed Apr 22, 2009
Foreclosures dont offer any better values than many other motivated sellers. It merely means that the owners lost the homes to their creditors. (if the value of the home was significantly greater than amount owed, it likely would have been sold on the open market) Sure ,some buyers can do well on foreclosures but these typical cash buyers can often do well with other corp sellers, divorces, estates, relo... again it is motivation.
Add to the equation that foreclosures can be slower and questionable as to owners rights, access for inspections...many buyers opt to avoid.
0 votes Thank Flag Link Wed Apr 22, 2009
What most people don't understand is that 99% of the foreclosed homes will still be sold at the market value (not at a discount). The banks are already taking a loss and it has become a large part of their business so they would rather hold on to a home longer and get a higher price.
0 votes Thank Flag Link Wed Apr 22, 2009
Hi Matt,

Many people do start out looking at Foreclosed homes. Recently the most popular offers have been on short sales. But the frustration level of waiting is usually too much for most Buyers. Then there are the Bank owned "deals". But, they often require more work than most individuals want. But if you are handy there are some very good opportunities on the market.

One deal recently involved a 1st time buyer who was looking at a short sale. It took so long the home went to Sherriff sale. Then about a month later it did pop back up as a bank foreclosure. The home needed minimal work and the home inspection was fine. So I would say timing was everything. We were diligent with checking the hotsheets on a daily basis and it worked out very well for the Buyer.

Let me know if you have any questions or need any help.

Take care, Hugh

Re/max Associates
Hugh Henry Jr
215-442-9162
remax@voicenet.com
Web Reference: http://www.HughHenryJr.com
0 votes Thank Flag Link Wed Apr 22, 2009
Sean is correct. Think of it this way: one person's trash is another person's treasure.

Don't worry about why others aren't buying them; instead, be thankful that the lack of buyers might help you to get a better deal.
0 votes Thank Flag Link Wed Apr 22, 2009
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