Is this currently listed as a short sale and goint to Trustee Sale (auction) in a couple weeks? Many times homes are not purchased at the Trustee Sale so the banks end up purchasing them back. Once the property becomes bank owned, the bank has a number of steps they must complete including obtaining Broker Price Opinions (similar to an appraisal but by licensed Realtors). The previous listing agent, most likely, will be excluded due to potential conflicts and the previous list price will have very little influence on the new list price. Depending on the bank, they will hire a 3rd party Asset Management company to take care of all the details including obtaining the BPOs, hiring the new Listing Agent, securing and cleaning the property, maintaining the property (including the gardening), etc. The banks do NOT was to own property, they want them sold quick and usually price them accordingly. Feel free to contact me with any additional questions and good luck!... more
That's a good question and what follows is just my opinion. I believe that the market will remain favorable for at least another two years as the experts expect foreclosure sales to increase for the next two years and foreclosures have an adverse effect on values. How favorable the market will be for buyers will also depend on what will happen with the lending industry. Loan underwriting criteria have become much stricter lately and many buyers who'd have been able to buy a house last year, are out of luck now. I think seller will be asked again to help out with closing costs and some sellers may even carry a second just to be able to sell their houses. Essentially, we are going back to a more normal market and unfortunately we also have to deal with a wave of foreclosures which is not necessarily normal. The real estate market has traditionally gone up and done, but not every down market has been accompanied by a flood of foreclosures. We'll get through this and in some way I think it was time for buyers to get a break.... more
You have to distinguish between homes that the banks already own and properties that are still owned by the borrower, but a notice of default has already been entered. The foreclosure procedures vary from state to state and I can only speak for California. The foreclosure process begins with recording a notice of default and then if the borrower does not cure the default within the prescribed time, the bank will publish a notice of trustee sale (the auction). If the borrower can't come up with the money to pay what's owed, the property is put up for sale through auction on the day specified in the publication notice. If nobody meets the minimum bid at the trustee sale (usually outside the county court house), the property goes back to the bank. Once the bank owns the property, the bank will typically list the property with a local realtor to sell the property through the MLS. Only if the property does not sell through the MLS, will the bank turn it over to an auctioneer. It's my understanding that banks do not sell directly to buyers.
Many borrowers who are in default or who owe more than the house is worth, will try to sell the property before the auction day through what's called a "short sale." Essentially, when someone is trying to shortsell, they are asking the bank to take less than what's owed. Buyers who wish to buy a shortsale property have to expect to be very patient as banks typically do not respond very quickly to shortsale requests. They respond a lot faster to offers once they own the property. Bank owned properties are known as REOs (which stands for Real Estate Owned).... more