Foreclosures – have many different names:
• REO (Real Estate Owned)
• Bank Owned
What is a Foreclosure? A foreclosure is a home that has voluntarily or unvoluntarily been returned to the mortgage company or Bank for a non-payment of the mortgage. Are these good buys? Often times these are good buys, but not always. Knowing the market and when to place an offer is crucial. We offer a free consultation to determine whether or not a foreclosure is the best choice for you.
What you need to know about buying a foreclosed home. . .
Let’s get straight to the point, if you’re planning on buying a foreclosed home you will first want to find a real estate broker who has experience selling these types of properties. The negotiations and transaction process is different in many respects than purchasing a home that is owned by an individual.
Buying a foreclosed home may land you a house with fantastic pricing, but the process is not easy and you may have to put offers on several homes before you get the home that’s right for you. Buying foreclosed homes can also be wrought with difficulties and hidden pitfalls that are often associated with distressed properties.
Working with the right real estate agent can also put you ahead of the game. Many people have the false impression that dealing directly with the listing agent will get them a better deal. This is simply not true. The listing real estate agent represents the Seller (which is the bank or mortgage company that now owns the home). How can the agent represent the seller and also negotiate the lowest price for you? Sorry, it doesn’t work that way.
The second thing you will want to do is make sure that you either have the cash on hand to purchase a foreclosed home or are pre-approved by a lender to borrow the money. Really good deals go quick. If you’re trying to work out financing after you’ve found a great property you’re probably going to be out of luck. That also means that you can’t expect the bank holding the foreclosed home to finance you. Foreclosures don’t work that way. The truth is, you will have to show proof of financing before your offer will even be looked at.
The Third thing you should be aware of is that most foreclosed homes are sold as is. Like any home – have it inspected! Banks don’t have to disclose damages and they may not even be aware of problems or damages such as plumbing, electrical, roofing or foundation issues. If there are problems don’t expect a discount. Sold as is means just that – no repairs.
Are foreclosures good buys? Some are and some are not. Your real estate agent should be able to show you relative price comparisons for foreclosed home sales in the area.
The process of buying a foreclosed home can certainly be daunting, but the recent economic decline has created an opportunity for first time buyers to really capitalize on distressed sales
Hud forclosures are owned by the U.S. Dept. and Housing of Urban Development (HUD) as a result of non-payment on a FHA loan. Not all agents are approved by HUD to sell these homes. We are approved buyers agents for these homes in Oregon.