Foreclosure in Dartmouth>Question Details

Sandy, Home Buyer in Dartmouth, MA

HI MY NAME IS SANDY AND I AM LOOKING TO BUY A NEWLY LISTED FORECLOSURE HOW MUCH CAN YOU NEGOTIATE WITH A BANK THE HOUSE NEEDS SOME REPAIRS GREAT LOCA

Asked by Sandy, Dartmouth, MA Sun Sep 20, 2009

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Sandy

Banks are negotiating on properties - more now than ever. As the foreclosures are coming back on th market - you need to justify the offer with the repairs needed. My office is in Westport and I would be happy to assis. I work with First Time Home Buyers with the purchase of foreclosures and short sales.

Give me a call.
0 votes Thank Flag Link Sat Mar 13, 2010
You probably will not be able to get much off the price-- $10,000 to $20,000-- Properties are price in "as is" condition... the is usually a "good value" there... all though not always. A Buyer's Agent will be able to tell you if the price is good or not... and should be doing a CMA for each home you think about making an offer on. These homes however are not always a "good" price... sometime the cost of putting the home back together will not make the home worth it, and my advice to you is to move on and watch the property... Banks will reduce the price (usually monthly, but not guaranteed)... so walk away and wait until the home is worth it to you. Many times the person telling the bank what a home will sell for (Broker's Price Opinion or Appraisal) is not from the area so doesn't really know the value a home should be.

So figure out what the cost of repairs will be (about) and the cost of the house, plus any "surprises" (with a bank owned there is always a surprise or two).

If that cost comes out to be a good value then go for it... if not, walk away.

You can also get an FHA loan to help with the repair cost... it is a 203K and will allow for up to $35,000 in repairs for the "Streamline" loan... which is what most banks are offering now. A simple loan, runs under the same guidelines as an FHA loan... takes a bit longer to close (you will need contractor quotes... which is painful to get and can take a while)... but the good news is you don't have to worry about how you are going to fix what you just bought.

I work in the Dartmouth area and would be happy to answer any questions... If you have already bought, congratulations!

Gayle Bartlett
Bartlett Realty Group
508-717-9004
gayle@bartlettrealtygroup.com
0 votes Thank Flag Link Mon Dec 7, 2009
Sorry for these back to back posts ... two more points.

1) If you pay in cash, your purchase won't be subject to a bank appraisal by a lender because you aren't using one.

2) If you need a loan, then you'll need a home improvement loan http://portal.hud.gov/portal/page/portal/HUD/topics/home_imp… I know that CENTURY 21 Mortgage does handle such loans.

Good luck!
0 votes Thank Flag Link Mon Sep 21, 2009
My presumption, of course, is that you're just talking about negotiating purchase price.

As Mr. Garza noted below ... the bank will not agree to do any work or anything else ... money is really the only negotiating point. Also be prepared (and factor in) that you may also be paying for the cost of any other work necessary to get the house sold (e.g. fire inspection, etc).
0 votes Thank Flag Link Mon Sep 21, 2009
You can negotiate A LOT. It doesn't matter how much the house originally foreclosed for ... the bank does NOT want to be a property owner.

Consider what a reasonable market price would be for the home if it were in relative move-in condition. Then start deducting the cost of appliances, putting in a new kitchen, replacing whatever needs to be replaced (is the boiler well maintained? Is the hot water heater recent?) and don't forget the cost of inconvenience for having to wait a couple months before being able to live in your home ...

The banks DO like to see large down payments and/or cash buyers because it would indicate a fairly smooth transaction (and less hassle means less cost to them).

If you need a referral to a real estate expert in your area, just let me know. An experienced Realtor would know how to manage this negotiation well for you. You aren't saving yourself by not using one much since the bank has already agreed to pay agents involved and the listing agent is not likely to help you.
Web Reference: http://www.commonmoves.com
0 votes Thank Flag Link Mon Sep 21, 2009
With a bank, almost nothing. In Minnesota all REO properties are sol AS-IS no warranties. Sometimes, banks reapir the property if the city does not allow a transfer of title without fixing some items.

Buy you will be very lucky of the bank fix anything.

Best and Buy!
0 votes Thank Flag Link Sun Sep 20, 2009
If the home needs a kitchen, you may not be able to get a loan for it.
0 votes Thank Flag Link Sun Sep 20, 2009
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