Property Q&A in Seattle>Question Details

Julia, Other/Just Looking in 98119

A notice of foreclosure sale on this house is scheduled for June 09. How does this affect the value.?

Asked by Julia, 98119 Wed Apr 1, 2009

This house has been in foreclosure many times since the early 2000's.

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This question is about this property: http://www.trulia.com/homes/Washington/Seattle/sold/806226-2…

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One thing that should be mentioned, the recent amendments to the Distressed Property law mean that buyers no longer need to avoid this type of situation. Assuming the property is listed (or the seller has an attorney), they can pretty much go after it without concern, as long as they don't negotiate a deal where the owner continues to live in the property, has an option to purchase it back, etc., basically a straight sale. There are some possible technical traps, but those should be very rare. A buyer should contact their own attorney in such situations.

This is actually good news for the buyers and the sellers, because the sellers would rather deal with a buyer negotiating hard than end up being foreclosed. The legislature last year didn't understand that, and it most likely resulted in a lot more foreclosures than would have otherwise occurred.
0 votes Thank Flag Link Wed Apr 1, 2009
Julia,
When a home faces foreclosure, and the date is quickly approaching, the bank tends to take less for a short sale aka pre-foreclosure. If the home is not listed, and the owner is not willing to do a short sale, they can stay until they are removed.
If you are interested in pursuing this further, please do not hesitate to contact me at 425.765.4432 or kenziekipper@gmail.com.
Kenzie
Web Reference: http://www.kenzierealty.com
0 votes Thank Flag Link Wed Apr 1, 2009
Julia,
The foreclosure notice doesn't implictly effect the value of the house beyond what the current market value might be. The house can still be sold in a possible short-sale arrangement if the lender/investor is agreeable. But if the listing price is above the owed mortgage(s) and in-line with current prices then that may not be necessary. If the home is actually foreclosed its value is still relevant to the current maket conditions though an institution may be inclined to 'cut a deal' in order to get the inventory off their books. At this point, the foreclosure is only significant to the current owner and any possible tenant at this point. If you are seeking to make an offer on the property, it's unlikely you'll cut an incredible deal unless the proper market valuation says so. You can contact me directly 206-218-7653 or visit my website for any further information.
Steve
0 votes Thank Flag Link Wed Apr 1, 2009
I haven't looked at the property, but that doesn't technically affect the value at all, if you use the same definition of value that you would normally use (non-forced sale between two unrelated third parties). But it might very well affect what the seller is willing to accept, assuming that they have equity. If they don't have equity, it might affect what the bank is willing to take in a short sale.
0 votes Thank Flag Link Wed Apr 1, 2009
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