Amy, Home Buyer in 02382

I've noticed the number of bank owned properties on the market has been increasing. How does buying a bank?

Asked by Amy, 02382 Tue Mar 4, 2008

owned property differ? Can you go in below the asking price?

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6
Amy,
Many banks have a list of foreclosed homes on their websites and also Freddie Mac listed by state and then town. Some allow you to do an inspection but if it's winterized you have to pay to have it dewinterized (approx $200) The pricing is usually under that of other homes because they don't have any disclosures and you have to accept it with no recourse if something doesn't work after the sale. I suggest asking for a home warranty to be included and paid for by the bank. Also have someone go over the contract so you'll know what you're agreeing to. Many banks also sell their REO (real estate owned) properties at auction for even less. Look up usahomeauction.com
1 vote Thank Flag Link Sun Mar 30, 2008
Amy, You can go below asking price and should determine the price you offer based on comparable sales in your area. Your buyers broker should be able to establish a fair offer price on a property based on location and condition. Because many of these homes have been "winterized," doing an inspection becomes difficult so you must do your homework regarding repairs that will be needed. As mentioned by others, you must be patient. If you are in a position to study the market, recognize a good value and then wait them out, now is the time to jump in.
1 vote Thank Flag Link Wed Mar 5, 2008
Hello Amy. Bank owned properties are popping up all over the place. That is a direct result of our recent lending crisis. As for dealing with the banks there is one thing that I can recommend as a qualified buyers agent.....have patience. Instead of an offer taking 24-48 hours to go back and fourth, a bank offer can and most likely will take weeks. My most recent dealing took 3 weeks to get a counteroffer.....and the counteroffer was over the list price. Crazy I know, but the banks all have a process and with the huge numbers of foreclosures that they are getting it is too tough for them to handle quickly. Be patient, hire a buyers agent to help deal with the bank, and understand that in most instances you will be buying a home as-is. Good Luck. Hope it helps.
Web Reference: http://www.mikecalef.com
1 vote Thank Flag Link Tue Mar 4, 2008
YES. You can go in below the asking price. The biggest differences in dealing with bank owned property versus dealing with a private seller are motivation and emotion. A bank is motivated to get the property off their books. There is no profit to be had, only loss to be stopped. A private seller has their own wealth tied up in a property. Banks are not emotional. They have no feelings about the property. Private sellers get very emotional about their property, even income property. Banks can take a while to make a decision. If you come in real low you may have to wait for an answer to go through several levels of management. Each servicer is different. I would rather negotiate with a bank than a private seller any day of the week right now. Many private sellers still have 2005-6 prices in their heads and often have the debt to match - no deals in that.
1 vote Thank Flag Link Tue Mar 4, 2008
Beware of bank owned properties ... But more importantly be prepared: manage your expectations in terms of timing and also ask all the necessary questions about the bank (who they are, their average time closing a deal, if it's a short sale make sure the owner has submitted their paperwork to the bank and make sure the bank has approved the listing price).

Good luck!
Web Reference: http://www.territoryre.com
0 votes Thank Flag Link Mon Mar 31, 2008
…Besides of all the time it takes to get the deal rolling, most Foreclosures are trashed by angry ex inhabitants and or need plenty of work. Banks refuse to do necessary upkeep since they are out of the money anyways. Another thing to keep in mind that the property might not even get appraised at the asking price and the banks would rather sit on empty homes than sell for a loss.
Be wary of the banks that want you to finance their foreclosure through them since they might inflate the appraisal.
Other than that have patience and just keep looking and trying until you get the deal.
0 votes Thank Flag Link Tue Mar 4, 2008
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