foreclosed homes do i havve to pay all at once?

Asked by Julisa, San Jose, CA Sun Jan 13, 2008

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Linda, , Oakland, CA
Mon Jan 14, 2008
If a home is in foreclosure, this means it is up for auction at the county courthouse steps. Check your local newspaper for listings. You have to have a cashiers check when the bidding ends. This means CASH! There are hard money lenders out there that can lend you money for foreclosures at a very high rate, say 9-11% , for a short term loan 30-60 days. Many investors use this strategy. However right now there are other ways to go about a "bargain" . Short sales, bank owned properties, probate and trusts sales and desperate sellers that need to sell before they lose the property.
Web Reference:  http://www.eastbayhomes.us
1 vote
Andrea Wince…, Agent, Milpitas, CA
Wed Jul 16, 2008
There are plenty of REO/Bank Owned foreclosed properties on the MLS where you can have a Realtor represent your purchase from the bank/seller. The banks hire a Realtor to market and list the property on the MLS and pays a commission to the listing Realtor and the buyers Realtor so the buyer does not have to pay his Realtor to represent him. You pick your own Realtor for free. The only time you must pay cash is when you bid at the courthouse auction/trustee sale. For a complete explanation of every step of the foreclosure process, I've found Realty Trac to be helpful. The link is below...............
0 votes
Andrea Wince…, Agent, Milpitas, CA
Wed Jul 16, 2008
There are plenty of REO/Bank Owned foreclosed properties on the MLS where you can have a Realtor represent your purchase from the bank/seller. The banks hire a Realtor to market and list the property on the MLS and pays a commission to the listing Realtor and the buyers Realtor so the buyer does not have to pay his Realtor to represent him. You pick your own Realtor for free. The only time you must pay cash is when you bid at the courthouse auction/trustee sale. For a complete explanation of every step of the foreclosure process, I've found Realty Trac to be helpful. There link is below...............
0 votes
Rochelle You…, , San Jose, CA
Wed Jul 16, 2008
I have real cases where people are buying REO that is listed on MLS through agency and people are financing them. I closed on one last friday and have three pending to close in August.
With all due respect to the previous answer, what you mentioned might be the case in Las Vegas, but I do talk from my personal experience that you can finance on an REO if it is listed on MLS. Sometimes if it is not offered for full cash you can also buy it under financing terms through Auction.
0 votes
Rochelle You…, , San Jose, CA
Sun Jul 13, 2008
Hi Julia,

It depends on where and when you buy the foreclosed home. Here are the possible ways:
1. In San Jose, buying at the market street outside of the court house on the side walk street.
You pay only cashier's check in full. I won'd recommend you buying a foreclosed home this way unless you want to swim with the sharks in the same pool. This is a real game and don't play it unless you are very savy and know the market even better than a Real Estate agent!
2. Buying at auction: If homes do not sell at "Market Street" they become REO, Real Estate owned by banks. In this case, bank will eventualy list the property on MLS through a Real Estate agent. from time to time, banks want to clear their inventory and they would place some of those REO properties on auction. This does not necessarily mean that you are buying the property at a bargain price. You could however come across some good deals. You just have to make sure that you have studied the market closly and do not fall into the bidding war at the auction. When buying at auction you have to consider the auctioneer's fees as well. Some of the bigest auction companies that I have been to charge about 10% of the winning bid on top of the price. Which means if you are bidding you must take that 10% into consideration also. You do not have to pay cash when buying at an auction. You can either go through your own financing lender or sit with one of the lenders at the auction and get your approval and sign up for the application. If you buy through this option, it is a good idea to use services of a Real Estate agent, since they could provide you with full service on coordinating the transaction and evaluating the market for your prior to your purchase and you are not paying them directly. They will get paid through part of that 10% that you have to pay the auctioneer regardless of using their service or not.
3. Buying REO (Bank owned - post foreclosure) listed on MLS. this is just like buying any other property on MLS. The response time normaly in REO properties is faster than short sale properties and more effective. If your agent knows the market well, and knows how to package your offer, you could get some real good deals out of these properties.
I have been involved in buying and selling 5 bank owned properties in the last 6 weeks and just closed o on a property that was sold through auction three months ago, and have pretty good information on dealing with these type of properties.
No matter which approach you take, review all your options in detail.
Good luck.
0 votes
Dorene Shirl…, , Campbell, CA
Thu Feb 28, 2008
Julisa - well this is a good example of being careful of the info you recieve. As an ex-forclosure officer...only one answer has been correct so far. Cashier's check at the trustee's sale. No exceptions! I do have an authentic auction on video. I filmed it last year. Not a great experience for a buyer. These guys are pro's. I've been many times and if the main characters arent bidding it's probably not a good deal. My advise...get a Realtor who knows how to write a contract. There are many strategies an experienced agent can use when getting the best deal for you. Many times it's not the price.
Web Reference:  http://www.DoreneShirley.com
0 votes
Andrea Wince…, Agent, Milpitas, CA
Thu Feb 7, 2008
In my opinion, the banks will usually accepted the price they are listed for which can be well below most recent neighborhood comps. They are eager to sell. Bank owned properties are all over the MLS and any licensed real estate agent can represent you in your purchase. The bank (seller) pays your RE agent a commission, not you. You only provide the monies toward the actual purchase of the property. So you get your professional representation for free to you and you don't have to deal directly with the bank. I tell ny buyer clients, why would you purchase your property directly from the seller if there's no price advantage? It's just as if (unfortunately) you were going through a divorce with your spouse....would you hire your spouse's attorney to represent you? You need your own representation. If you'd like me to email you some bank owned listings in your desired areas, contact me through my website below. Kind regards.
0 votes
Jacklin1, , Milpitas, CA
Thu Feb 7, 2008
What's more, if it is an REO home, you can expect the bank to make a counter offer. Then it will be up to you to decide whether to offer a counter to the counter offer. It is important to understand that you will be dealing with a process that probably involves multiple people at the bank, and they don’t work evenings or weekends. It’s not unusual for the process of offers and counter offers to take days or even weeks.

Consider working with local REO experts that specialize in bank owned properties. Here's such an outfit: http://www.bayareabankreo.com
0 votes
Andrea Wince…, Agent, Milpitas, CA
Tue Jan 15, 2008
RealtyTrac.com has a very clear explanation of the foreclosure process. Not to get into too much detail, first the homeowner becomes delinquent on their payments, the bank sends files with the county and sends the homeowner a notice of default, the homeowner has a short time to catch up, if they don't, the bank files and sends a notice of trustee sale. The trustee sale is the bidding that occurs "on the courthouse steps" and yes, to participate in that bidding you will need a cashiers check. The highest bidder is usually the original bank (or lender) who then gets the house back. The house is now REO (Real Estate Owned) by the bank. The bank will then hire an auction house to sell the property, sell it on their own, or sell it through a licensed agent on the MLS (there are many out there REO on the MLS). A short sale is when the homeowner still holds the title (pre-foreclosed) is obviously having difficulty with the current mortgage so the bank allows them to sell it on the open market for an amount lower than what they owe the bank (there are many short sales on the MLS). Whew! Hope that helps! There are also answers to foreclosure questions and laws on my website listed below as a reference.
0 votes
Ali Moein, Agent, Saratoga, CA
Sun Jan 13, 2008
Hello Julisa,
Buying a foreclosed home is very similar to buying any other home. You can finance the purchase. All lenders require that you're pre-qualified for the price of the home and some require that you're pre-qualified through the same lender. If you do have a home in mind, your Realtor can find out and communicate with you the exact requirement for purchasing the home you're interested in.
Hope this helps,
Ali Moein
0 votes
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