|
|
|
|
Buying REO property or a foreclosure in Carrboro?
 |
 |
 |
Foreclosed upon and bank owned property purchases require the assistance of an experience professional.
Should you have questions regarding real estate in Carrboro, North Carolina, call me or send me an e-mail.
|
|
|
|
 |
What's an REO?
"REO" or Real Estate Owned are homes which have completed the foreclosure process and are currently held by the bank or mortgage company. This is unlike real estate up for foreclosure auction.
If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees amassed during the foreclosure process. The buyer must also be able to pay with cash in hand. To top everything off, you'll receive the property completely as is. That could include prevailing liens and even current occupants that need to be kicked out.
A bank-owned property, by contrast, is a much cleaner and attractive proposition. The REO property was unable to find a buyer during foreclosure auction. The lender now owns it. The lender will see to the removal of tax liens, evict occupants if needed and generally plan for the issuance of a title insurance policy to the buyer at closing.
Note that REOs may be exempt from standard disclosure requirements.
For example, in California, banks do not have to give a Transfer Disclosure Statement,
a document that ordinarily requires sellers to reveal any defects they are knowledgeable of.
By hiring Tiffany Elder - Broker, Realtor, you can rest assured knowing all parties are fulfilling North Carolina state disclosure requirements.
Am I guaranteed a low price when purchasing an REO property in Carrboro?
It is commonly thought that any foreclosure must be a good buy and a possibility for guaranteed profit. This simply isn't true. You have to be prudent about buying a repossession if your intent is to make a profit. Even though the bank is typically anxious to sell it soon, they are also looking to get as much as they can for it.
When considering what to pay for REO property, carefully analyze comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale.
It is possible to find REOs with money-making potential, and many people do very well buying and selling foreclosures. However, there are also many REOs that are not good buys and not likely to turn a profit.
Ready to make an offer?
Most mortgage companies have a department dedicated to REO that you'll work with in buying REO property from them. Normally the REO department will use a listing agent to get their REO properties listed on the local MLS.
Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about their knowledge about the condition of the property and what their process is for receiving offers. Since banks typically sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for unseen damage and cancel the offer if you find it.
As with making any offer on real estate, your offer may be more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.
Once you've submitted your offer, it's customary for the bank to respond with a counter offer. From there it will be your decision whether to accept their counter, or offer a counter to the counter offer.
Your deal might be final in a single day, but that's rare. Since offers and counter offers usually give the other party a day or longer to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.
|
|
|
Tiffany Elder, MBA, Broker, Realtor
Paradigm Properties
P.O. Box 628, Carrboro, NC 27510
Office: (919) 260-2507 Fax: (866) 854-4717
Email: tiffany@tiffanyelder.com
|
