Mortgage Updates

By getting pre-approved before you begin the purchase you will save yourself a great deal of time and anxiety.

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Not all is rosy in foreclosure land... The price may be "right"... but what does that actually mean? 

Typically a foreclosure property is listed well below it's original appraised value. - Don't be fooled.  Sure the property appraised $200,000 higher in the height of the real estate bubble, but that does NOT mean that the listed price is value.  Value could be well below the list price.

The most difficult and time consuming purchase is a bank owned property.  This purchase requires that you do your own research and compile your own data. As a buyer it is imperative that you work with a good real estate agent.  An agent that works for you, helps you research the value for the property in question by providing a CMA.

Unless the property is listed or vacant, there is generally no information on the condition of the inside.  If the house is bank owned, the possibility of entering is highly doubtful as the tenant/owner is normally not very hospitable to the idea of you evicting them from their home.

The financial risks of buying a Bank Foreclosure

You must be prepared to finance the rehab of the property. Your contract needs to provide you access to the house with a home inspector and /or contractor. You need to know the condition. If the house is occupied by the tenent/owner, access may not be possible or readily available to you.  In these cases as access to the property is not guaranteed. If you are a homebuyer with a limited amount of cash, stay with properties where you can gain acces for the inspections.  And, be sure to ask me about our "re-hab" loan - perfect to take care of the cosmetic repairs typically required in vacant or abandoned bank owned properties.

Your deposit is at risk if you are not able to obtain a mortgage within the 30 day time frame allowed after your successful won bid on the property.  That is where a "pre approval" comes in. I recommend that before you shop, get pre approved for your loan.  Not just "pre qualified" but actually approved.  BIG difference.

Most Bank REOs have a third-party manager who is your liaison with the bank. Offers must be made through them. They will relay counteroffers from the bank to you or your agent. In general, banks do not negotiate much on price, so if you offer less than the asking price be prepared to go through the negotiation process several times for a minimal discount.  I would suggest credit towards closing costs as opposed to a price cut, unless of course the property is still overpriced for it's condition.

I have available updated lists of Bank and HUD owned homes in Nevada, Placer and ElDorado Counties. To have this source emailed to you please complete the form below.

Happy shopping.