If a Buyer asks you about a Pre-Foreclosure, would you know what they are talking about? First i will burst many Buyers bubbles by telling them a “Pre-Foreclosure” is simply a home in the Foreclosure process. It is not Bank owned yet, it is still owned by the Home Owner who owns it, they are just in default. Lots of Buyers ask to purchase Northern Virginia area pre-foreclosures and are devastated when I often tell them they can not. Many homes in foreclosure are not for sale as the owner simply owes more than the house is worth.
Once the Foreclosure auction takes place, if it does not sell at auction, it becomes Bank Owned also known as a REO.Is there really a difference between Bank Owned Homes and a Foreclosure? With a shortage of homes For Sale in home buyers are looking to Bank Owned homes to find their Dream Homes. The problem is most buyers and even some buyer agents do not know know what is involved in buying a Bank Owned Home.
Not all buyers can always buy Bank Owned Homes. Some may be cash only because of their poor condition. Some may look like a diamond, but may have hidden defects. You MUST do your home work literally and know what you are getting into and what the cost to fix anything in that home is.
The BEST way to be prepared is by hiring a “GOOD” Buyer Agent. who is WELL experienced in your area and with Bank Owned Homes. One that will guide you through each step of the Buying or Selling process. To the consumers who were successful, they found the secret which I would like to share with you.
The HARD TRUTH is that the BEST way to be prepared to buy or sell a home is by hiring a “GOOD” Agent. One that will guide you through each step of the Buying or Selling process. To the consumers who were successful, they found the secret which I would like to share with you. Free advice can be worth what you paid for it, so when you are ready, do it right.
If you read all the way to hear, i hope you like my series of “catchy titles” They are meant to grab your attention and let Buyers and Sellers know how to avoid such pitfalls by simply hiring a better agent. One that will work with them throughout the buying and selling process.
THE TOP TIPS TO FIND A “GREAT” REAL ESTATE AGENT
1. LEARN THIS ONE FACT: One should know that All Agents are not created equal and every buyer or seller should take the time to hire the BEST not just the biggest Agent or Company. It is important to Hire the BEST Agent. In NoVa that could be Amelia Robinette.
2. OUR TIP TIPS FOR BUYING A BANK OWNED HOMES: THE TOP TIPS TO BUYING A BANK OWNED HOME:
- Include a pre-qualification letter or proof of funds with your offer. Failing to do so will often lead to rejection or lost time while they have to ask you to provide it as another offer gets accepted while yours was delayed.
- Do NOT add contingencies to your offer accepted as banks look for “Clean” contracts without contingencies other than obtaining a mortgage.
- If you are applying for a FHA mortgage, check before making your offer if the home can even get a FHA mortgage in it. if it needs work. You can easily get a list of what is acceptable to check if the home meets the criteria or not.
- When making an offer, you should not base your offer on deducting a specific percentage off the Listing price. You do not know if that listing price is market value, priced above market value or already priced at a great discount below market value. Assess what the home is worth in today’s market and deduct for repairs.
- Do not include time limits for the bank answering your offer, Banks work at their own pace. Be prepared to wait for an answer and signed documents. Putting deadlines for answering your offer will simply get it rejected or ignored.
- Do not assume everything is in working order without testing it BEFORE you make an offer. Virtually all homes are sold ‘As Is”.where the BANK will not renegotiate after a home inspection or fix anything not asked for in your initial offer.
- Do not assume the bank will just grant you an extension if you are not ready to close. Cash offers and conventional loans are expected to close within 30 days and FHA and USDA loans are expected to close within 45 days.
- Do not assume all Listing Agents of Bank Owned Homes are the same. There are some very good ones and some very bad ones. The sale also only goes as well as the listing agent is attentive to their listings and uploading and updating offers.
IN SUMMARY the key to having a successful purchase or sale can increase simply choosing a better agent. Buying a Bank owned home can be the best or worst purchase of one’s life. Being prepared to purchase can eliminate a lot of problems. Writing a good offer can eliminate a lot of other problems that often pop up and lastly knowing what to expect can eliminate most of the rest. Having a Listing agent who is experienced in Listing, managing, negotiating and selling Foreclosures means a great deal. If banks would simply assign Listings to the agents who are attentive to the banks needs instead of those bad agents who have too many listings or are do not manage their listings, do not maintain their listings, do not answer calls , do not return messages with answers to buyers questions, do not show their properties and do not update agents who submit offers. The REO world would be a better place for all of us.
CONTACT US AT 703-407-3426 (call or text) or email [email protected]