Foreclosure in Chandler>Question Details

Concerned, Other/Just Looking in 85224

Who sets the standard on how low of a price a realtor can sell a home for that is in foreclosure? In December

Asked by Concerned, 85224 Fri Mar 7, 2008

My neighbor had his home on the market for $304,000. which was average for our area. It went to foreclosure and now they have it up for sale for $220,000! That is a disgrace to everyone around and just brings our home values down.
How can it be listed so cheap?
(The owner owed $318,000 on it before they bailed)
Oh finally, the yard is full or weeds in the front and the grass is 4 foot tall in the backyard. Who needs to take care of it?

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Hey Concerned,

By saying that you are in 85224, That being roughly South of Warner, and between the 101 & Alma School.
Now taking into account that you wonder who takes care of the landscaping..Hmm must be vacant.

"That is in Foreclosure"..."is in"....has not been foreclosed.........being Short sale.

You live on a street that rhymes with Bark.?

I can`t use the real name, I am not sure that there is enough money in my legal defense fund

Well if I am correct.

Then the home is a short sale, the Realtor is simply lowering the price to bring in buyers. The newest trend in short sales is to bring in as many buyers and create a bidding war. Besides that the bank wont start talking to the listing agent, or get the ball rolling until there is a contract.

Don`t worry, it is very unlikely the bank approve that price. Bad news is the home will be foreclosed and become a REO.
The bank will do a BPO AKA Appraisal, and re list the home probably in the high 200`s.

Call the Realtor to voice your concern about the landscape. While you have them on the line ask if it is a short sale, again if it is, the bank needs to approve that price.
The Bank is not going to walk away from that much money.

Keep me posted,
Patrick
480-543-9899
1 vote Thank Flag Link Sat Mar 8, 2008
Mr.P, Other/Just Looking in Arizona
MVP'08
If the property went to trustee sale and reverted back to the bank, due to no other bids, then the bank will set the new sales price usually with the assistance of BPOs (broker price opinions) as well as opinions of value from the assigned REO listing agent.

I understand your frustration, but in the long run it may benefit you to have the sold sooner than later to avoid the unsightly property condition bringing down the neighborhood appeal.

It is the bank's responsiblity to take care of the property since they are the new owner. Typically the assigned REO listing agent will prepair the property for sale and maintain the landscaping until the home is sold. The bank then reimburses the listing agent for any costs they incurred.
1 vote Thank Flag Link Fri Mar 7, 2008
The seller determines or sets the asking price. Many lenders will discount the property based on the condition, selling it as is and based on the market conditions.

When a lender forecloses they pay almost another 50K in costs to do the foreclosure and then they have carrying costs. It is sometimes better to price it to sell.
1 vote Thank Flag Link Fri Mar 7, 2008
Pam Winterba…, Real Estate Pro in Danville, VA
MVP'08
Contact
The seller of a property determines the asking price. A Realtor provides pricing advice and determines whether or not they are willing to market the property at the price a seller determines. Sometimes a Realtor will decline to market a property - usually because a property is overpriced. If the property is this much below the marekt value of the neighborhood, expect mulitple buyers who will bid the price up. Priced for a quick sale is a good thing. The sooner a buyer takes title, the sooner those weeds will be cut.
1 vote Thank Flag Link Fri Mar 7, 2008
Deborah Madey, Real Estate Pro in Brick, NJ
MVP'08
Contact
The bank sets the price, not the realtor.
0 votes Thank Flag Link Mon Jun 30, 2008
Get used to it when all is said and done with the level of inventory coming back they could be selling houses in your neighborhood for a 100k a pop trying to get rid of them sooner than later and yes...that will be your new comp...try as they might Realtors don't set the price on Foreclosures...Realtors provide guidelines via what is called a B.P.O. but by and large their numbers are typically ignored more times than not...typically a R.E.O. manager already has an idea of what he/she is willing to sell the property for via an appraisal that was done during the time the property was being foreclosed on...the longer the property sits on their books the lower the price if 220k doesn't sell it in 30 days it will be marked down to 190k if that doesn't do it...after another 30 it will be marked to 165k and that will go on until it's sold and they won't really care what you think about it...it's about their survival not yours...so I wouldn't spend a lot of time dwelling on it...and them cleaning up the yard will be a dice roll at best...
0 votes Thank Flag Link Mon Jun 30, 2008
Hello there,
A home in foreclosure will always be of a lower value even when the market was not as challenging as it is right now. In my opinion the worse thing that can happen is for this house to sit there empty and decaying...so the sooner it finds a buyer the better is for everyone. As for the value of the surrounding homes, if your area does not have a lot of home in foreclosure, this one will show as a blip on the "radar" of comps made by realtors when pricing your or other homes for sale, if it does not stay too long without an owner. Hope this helps.
leonardo
Web Reference: http://www.leonardoteam.com
0 votes Thank Flag Link Sat Mar 8, 2008
I think you have good cause to be concerned. It looks like the property is priced for a quick sale and that's a good thing. The hope is that multipul bids will bring the price up.

On the downside, if the house sells really low, then you're stuck with that price as a comp.
0 votes Thank Flag Link Sat Mar 8, 2008
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