Foreclosure in Philadelphia>Question Details

Warren, Home Buyer in Philadelphia, PA

Buying a new construction town house which is bank owned by foreclosure.

Asked by Warren, Philadelphia, PA Tue Dec 16, 2008

I'm looking into buying a house that is a not yet completed new construction town house. It appears from the info that I've gotten, during the construction of the home the construction company fell behind 3 payments and the bank foreclosed the property. I don't know if it's the same construciton company working on the property but it would seem that all construction has stopped, and work will resume once a contract is locked in.
The property price is already 2/3 of the original price if the property wasn't foreclosed. My question is, how much room of negotiations do I have to lower the price, or at least have the bank cover the closing costs?

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3
Warren,

This property as you detailed is owned by a bank. Banks are more difficult and complicated to deal with then the average seller. Therefore, it is even more important that you have representation if you wish to pursue purchasing this town house.

You have many questions, and you need straight answers that are looking out for your best interests. This building process has stopped and started, how does that affect the warranty? Especially if the original builder is now out of the picture. Difficult, but not impossible areas that MUST be negotiated on your behalf.

Do you have a local real estate agent that you are currently working with? If you don't, I have some highly trained associates in your area that I would be happy to put you in touch with.

Good luck and be very careful.

All my best from the Beach. Happy Holidays!

Monica McNamara
Ocean City, Md.
877-480-7653
0 votes Thank Flag Link Thu Dec 18, 2008
Warren,

Typically there is some room for negotiations when a bank is involved. As stated below make an offer and see what happens.

One of the biggest concerns in this type of situation is - Be careful where your escrow deposit is being placed. I have heard too many stories about the builder using the deposit money towards construction instead of putting it into an escrow account.

Another potential problem is they build your home and then stop and not finish the developement until years later.

There is obviously the upside of buying at a 33% discount with low interest rates.

Good Luck, Hugh
Web Reference: http://www.hughhenryjr.com
0 votes Thank Flag Link Tue Dec 16, 2008
You never know what you can know about negotiating with a bank until you give it a try, unless the project is taken over by a marketing or real estate company that represents the seller. Even if that is the case you should definately have a Buyer's agent representing YOU. Frequently they tell the buyer "no" to negotiation, but they will do something better for the Realtor, in hopes that the Realtor will bring them more business.

BUT MORE IMPORTANT than this is the concern of the community being completed and if there is an Association that takes care of common grounds. It is very important to find out more information if there is any common areas that need to be maintained.
0 votes Thank Flag Link Tue Dec 16, 2008
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