Foreclosure is a very common word all over the media for the last years. What’s it all about and is this really a good way to buy a bargain property.
Here in the Sunshine State of Florida, Foreclosure property has become normal for our every days real estate business. Parts of South Florida where on top with the numbers of Foreclosures right after cities like Las Vegas Nevada or Phoenix Arizona. These regions were affected also due to the incredible construction and real estate boom from 2000-2006. Many of the affected properties built from 2000 where affected. Due to the falling prices since 2005, many of the home loans suddenly became upside down and the homeowner who could not afford it anymore due to the suffering economy and high unemployment rates walked away. Banks are sitting on an incredible inventory and they have to get rid of it. Here comes your opportunity.
As always, where some lose others win.
These Homes Condos and Lots can be found in the middle of good and attractive residential areas, some with boat access to the sea others on the golf course or in gated communities, priced far below comparable properties. The price level compared with 2005 even with regular sales sometimes is reduced to about half, and as a Foreclosure property the price is usually even lower.
Sounds very tempting! So what is the reality in the search and purchase.
Our experience shows the potential buyer will usually approach the market on the Internet. Most are browsing search engines for a local MLS Real Estate database or use nationwide systems like the Realtor.com site. We recommend to use a local MLS Database which is usually current. Once it’s found criteria are needed to narrow the Results. Location, size, price, Bed/Bathrooms etc. are usually the main criteria’s. From this point on you will be flooded with a variety of offers, which makes it almost impossible to find your favorites. Conclusion, without on-site assistance from an real Estate expert you are not able to go ahead.
Get in touch with a Realtor in the Area and discuss your concerns before you start your search.
Once you start your search online , you may notice quickly that some of the selected properties are no longer available because someone else has already submitted an offer and the status changed to "Pending". A long term online search only helps you to get familiar with the market. The timeframe between finding a foreclosed home and submitting an offer should be very short. Otherwise the chances for success are very small. Some buyers are able to make decisions without seeing the Home by themselves and by trusting their realtors judgment and research, others have to be there. Our experience shows that there is both types of buyers and both paths to success.
You have made a decision, and want to submit an offer for the desired home, land or condo.
Your Realtor should assist you to find the right offer price. He has access to background information and history of the property which leads to a realistic offer. This may be below or above the Listing Price. There are many reasons. Below because on closer look at the background data and the property proves that the seller has listed too high. Higher because the property is very interesting and has a good listing price, what often leads to multiple offers from other interested buyers so the price will be driven up to get the property.
What the closing cost and how does the closing process work.
The purchase procedure is more or less standardized. In the case of a Foreclosure sale the seller decides usually who will be Title agency or Attorney which prepares the closing, papers called Deed HUD statement, etc., and records the deal in the local property database. The closing costs for title insurance, Doc Stamps, Closing Fee, etc. can be expected somewhere at 1-2.5% of the purchase price depending on what costs the seller (bank, lender) takes over. The commission for the listing and selling broker usually should be paid by the seller.
I purchased a bank sale property, now what?
Normally, depending on the condition and purpose the restoration begins. Usually garden, pool repair, paint, floors, etc. has to be done.
You should work with a local licensed contractor who will perform the necessary work. This is of course a matter of trust and the best way to find them is to listen to recommendations.
