Foreclosure in Duluth>Question Details

Ajp0522, Renter in Duluth, GA

Trying to purchase a REO Foreclosure, cash deal. Closing date given is only 5 Business days after deadline for Contract of Sale. Feels rushed.

Asked by Ajp0522, Duluth, GA Wed Nov 23, 2011

The Addendem to Contract of Sale was emailed to me this morning. They want it signed and returned within 48 hours with $1000 Cashier's Check. No disclosures were given, not even the Contract of Sale. Just the Addendum. I requested copies, no response. Should I worry? Something doesn't feel right.

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Foreclosure sales in the state of GA are normally processed on Georgia Association of Realtor (GAR) forms with addendums from the seller that override specific areas of these forms. It is in your best interest, your right and benefit to have a realtor represent you. You should have ALL these docs before you sign anything. These docs will address the earnest money; who holds it and what happens if you do not close, which happens more often than not. For some of the foreclosure properties you can not get title insurance, because you cannot get clear title; would you be willing to move forward if this is the case? Might be reason for rush. GA has different closing process than most states, we do not close with a title company. Unless you understand real estate process in the State of GA and foreclosure sales, at this point you should either hire a real estate attorney or real estate agent to represent you and review what you do have. Good Luck!
1 vote Thank Flag Link Wed Nov 23, 2011
Most every REO sale will use the GAR (GA Association of Realtors) sales contract in addition to the contract addendum provided by the seller. HUD is the only one I can think of that does not use the GAR.

REO properties are always sold without disclosures. This is because the seller never occupied the properties and therefore has no direct knowledge of any issues.

Unless a title search has already been done and is back and clear, I really dont see you closing in 5 days. For REO sales, the sellers always require the final HUD statement 48-72 hours prior to closing.

Rodney Mason, NMLS #151088
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Prospect Mortgage
825 Juniper St NE, Atlanta, GA 30308
Office: (404) 591-2453
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Prospect Mortgage offers a full selection of mortage programs including:
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1 vote Thank Flag Link Wed Nov 23, 2011
This is really something you should ask your Realtor. But, for REO deals purchases with all cash, a short time frame is very common. That's one of the reasons why you get a discount in the first place. The assumption is that you're knowledgeable about the property and have the money to close quickly. If you are uncertain about any issues, check with your Realtor before releasing any contingencies, if there are any.
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1 vote Thank Flag Link Wed Nov 23, 2011
Don't worry about the contract, worry about the title policy...Once you get the preliminary title work from the seller, your attorney will know if and what the conditions are on the title policy. If you cant get a cleared title policy, then good luck getting a mortgage or being able to sell it down the road to another person that does need to use a mortgage.
0 votes Thank Flag Link Sat Nov 26, 2011
You won't get disclosures and won't really control the deal other than a "take it or leave it". However, there should be a due diligence periord for you and contract to close in 5 days is not enough time to get everything done. At a minimum, every buyer of every foreclosure needs have an appraisal (even with cash unless you've personally seen legitimate and recent closed sales just like an appraiser will use), inspection and a good going over for mold.

Jumping over your agent isn't smart, if they are a numbskull then you screwed up choosing and using her. The seller shouldn't be jumping over her either. Several things about your question and the circumstances give me pause for concern....

I'm a certified appraiser for foreclosure homes - if you want to see what some of these look like before clean up - you'll see why you need a systematic process when looking at these.

0 votes Thank Flag Link Thu Nov 24, 2011
When Buying a Foreclosure from a Bank, we will not get DISCLOSURES, because the Bank does not have "First Hand Knowledge" of the premises.
This makes it critical that the Buyer does the Inspections and that you have Inspection Contingencies!
I have never gotten a signed Contract from a Bank, just the Addendum.

If you don't get some Doc's from the Listing Agent; you may be able to request copies from the Title Company: They may also be included in your Closing Documents.

Good luck, God bless and have a good Thanksgiving.
0 votes Thank Flag Link Wed Nov 23, 2011
Thanks for all the quick responses. I actually do have an agent. She's not responding to any of my requests or questions. So I decided to contact the closing attorney directly. Thanks for all the info!
0 votes Thank Flag Link Wed Nov 23, 2011
Normally you would make an offer in writing on your states "standard" purchase and sales agreement. If accepted teh bank will give you their version of the sellers addendum, you will need to sign it and get it back within 24-48 hrs as well as it would require your earnest money deposit in the form of a cashiers check to be given by you. Usually within 1-2 days yiou will get teh addendums and your offer signed by the bank.…

Please see my blog for a full list of tips on buying a bank owned home
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0 votes Thank Flag Link Wed Nov 23, 2011
That's standard on all REO's. You're fine to proceed as long as your attorney has given the ok.

Marco Gomez
NYS Associate Broker
Keller Williams Landmark II
Serving Queens, Nassau and Brooklyn
0 votes Thank Flag Link Wed Nov 23, 2011
I can understand how you feel. I have purchased several hundreds foreclosures since 1981, and always feel anxious. If you have time give me a call, I am sure I can guide you through the process and help with relieving the anxiety you are experiencing.

Van S. Purser - Managing Broker & Investor
Van Purser & Associates LLC
Providing Real Estate Solutions Since 1981
Office: 770-623-3313 Cell: 404-863-2340
Fax: 770-623-0531
Web Site:
0 votes Thank Flag Link Wed Nov 23, 2011
If you feel "rushed" and are starting to "worry" you have the option to walk away. If you are attempting this on your own, negotiating directly with a lender, there will likely be several more things that won't "feel right" in my humble opinion.
0 votes Thank Flag Link Wed Nov 23, 2011
So what I think I hear you saying is that you have entered into a complicated Real Estate transaction with a large government entity, most likely Fannie Mae or HUD, and you don't have an agent to help you explain and guide you through the sales contract and the seller's addendum and the seller's operating procedures when purchasing a foreclosure? How did you get an accepted sales contract in the first place? Did you do this all on your own? Do you have an agent? If you have an agent, seek advice from your agent or broker. If you do not, I suggest you hire an agent and pay him/her a commission out of your own pocket since you are now under contract and the seller won't pay their commission. That way you will get the advice and peace of mind that you are seeking. Good luck.
0 votes Thank Flag Link Wed Nov 23, 2011
Unfortunately, banks can set their own terms as your recourse is " Don't Buy It ".... the good news is it's foolish for them to make their terms so burdensome, but that's part of why you get such a great deal. The bad news is they do it anyway. Have your atty look over the addendum.
0 votes Thank Flag Link Wed Nov 23, 2011

Sounds pretty standard for a foreclosure....they are always "ASIS" with right to inspect and with such an agreement disclosures are normally not included since the "bank owner" is not personally familiar with the subject property. it is expected that the buyer will take measures to protect themselves by conducting necessary and applicable inspections.

If you haven't done property inspections, it would be advisable to do so prior to making a decision and commiting additional money to this effort.

Where is your agent in this process? They should be able to answer your questions and assist with a seamless transaction in which your personal interest are protected.

If you feel that things are not as they should be, it's always advisable to consult an attorney for their opinion and professional advice.

Best wishes,

0 votes Thank Flag Link Wed Nov 23, 2011
REO properties are being sold by sellers (banks government etc.) who did not reside in the home, therefore they don't provide disclosures. If you don't have an Agent, which it sounds like you dont, then you need to use one in the future.
0 votes Thank Flag Link Wed Nov 23, 2011

I'm not sure your question was worded correctly. It sounds like you may be purchasing a HUD home. When an offer is accepted on a HUD home, they will send you the addendums and you have 48 hours to get the paperwork back to them with a certified check.

If it is a HUD home you typically have 45 days to close. I am not sure what closing date given is only 5 business days after deadline for contract of sale means. What was the closing date on the agreement of sale? Does the addendum change that closing date?

Your agent should be helping you.


Joe Finnerty
Prudential Patt White Real Estate
Lehigh Valley Office, PA
0 votes Thank Flag Link Wed Nov 23, 2011
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