I'd like to start this post off with a reminder that what I share here is from my own professional experience. I understand that each family, individual, or investor is unique. Because of this, each real estate journey is different...there may be similarities, but truly there are no two exactly alike.
I ask that you read my blog posts with an open mind. There is much to know about real estate...it's not just about a home or the parties involved. It's also about understanding the amount of risk each client is exposed to and helping them find their most comfortable path.
This month has exposed me to such a variety of properties and scenarios - short sale, bank-owned, bankruptcy...I reflected back to 2007 when the first short sale contract crossed my desk. It was such a foreign type of real estate transaction back then...now, there are short sale properties in just about every property search I do. Today's market is tough for buyers, sellers, and brokers. But as a professional real estate broker, I'm so glad to be in the business during this time. Knowledge is power. The more I learn, the more I can share with you.
Today, I'd like to talk a bit about bank-owned properties - real estate that has been through the foreclosure or bankruptcy process and is now on the market for resale.
There are several important things I think would be helpful to buyers of these properties:
1) Banks have typically made any repairs they felt necessary prior to putting the property on the market. If the listing states 'sold as is', they really mean it. You are either willing to accept the home in its current condition or move on. I've seen bank-owned property that look very impressive - clean, updated, etc. With an equally appealing asking price, these properties go under contract very quickly. I've also been in many properties that need something done in every room. Know what your limitations are and stand by them.
2) Read every word in your contract - at least twice. Be aware of any expenses that you may be responsible for before, during, and after closing. There are several different scenarios here, so I will just share one - buyers/brokers could be responsible for paying for a property to be de-winterized for home inspection and again to re-winterize. There are extra fees if a home inspector is unable to complete their report and have to come back out again to do so.
3) Work with a real estate broker who is going to be with you throughout the entire process and not just write the offer up on your behalf and collect a check in the end.
I was in a bank-owned home this week. For this particular property, it was my 2nd showing. First time was extremely late in the day and dark, dark, dark. It didn't help that there was a pretty large blood-like stain on the carpet, and access to the crawl space was wide open and more dark. I made it a point to show the home during the day to give it a fair shot. Gosh, I'm so glad I did...the home is in better shape than you'd find with owner-occupied...still needs a bit of work here and there, but overall a very nice property. Client thought so too!
If you or someone you know are thinking of buying a bank-owned property, my sponge is thirsting for more knowledge. I'm happy to experience this real estate journey with you!
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