14 years ago
Foreclosure help needed, expert advice appreciated?
My husband and I have found a home that is in foreclosure status (per our agents MLS). We're first time buyers and are new to this (sorry if I sound ignorant in any of this). We have to get pre-qualified through Countrywide first (we are applying this week) then were told we can get the funds through any outside source once were pre-qualified with them first. Here's my questions
1. I have heard that dealing with foreclosures can be a way longer process than dealing with owners, is that true? and why if almost 50% of homes for sale now in Southern California are foreclosures now?
2. Can we negotiate at all or are they dead set at the listing price?
3. Can we ask for help paying closing costs if not all?
4. If we get approved and everythings a go, how long before we get the keys, (the people still live there) do they get a 30 day notice to vacate?
5. On the mls it says "in-forclosure" does that mean its bank owned or REO now or is a "pre" foreclosure? I heard those are better and give more room to negotiate price and other things..
Thanks so much in advance!!! I've googled alot of this but get biased advice and don't know who to believe anymore... I just want straight up real answers from nobody involved... Thanks
14 years ago
Go ahead & get pre-approved with CW but do not get your financing from them. List price is not the bottom line they will take. Paying closing costs is always negotiable, it just means they will not come down as much in price. They have a bottom line figure they will take. It's just figuring it out. Your agent needs to find out from the listing agent when possession can be. Banks, in their contract, say you will pay $100 a day for every day the closing is delayed over 30 days. That is if it is your fault. They have no such clause if it is their fault. It can be done, but you need to ask questions about possession & any other reservations you have.
14 years ago
A lender CANNOT LEGALLY REQUIRE that you go through them for pre-qualification, pre-approval, the loan, etc if they own the property.
Just know that.
1. Foreclosures do take a bit longer b/c you are dealing with the Trustee (which is usually an attorney) assigned to the mortgage account and not a homeowner.
2. Everything is negotiable...DO NOT base your offer on anything but the comps your Realtor pulls...too many first-time buyers say, "Oh, it's listed at $250K , We'll offer $225K!!!"....it's not a deal if your Realtor pulls comps and it's not worth a dime over $199K.
3. You can ask for CC, but generally, you won't get them...you generally won't get requested repairs either.
4. The people living there do not get a 30-day notice to vacate...the bank has already taken back the property....if they give you a date to close, you'll be able to move in on that day AND get your keys on the same day.....REFUSE to sign the closing documents if the attorney tells you that you cannot get the keys that day....I'm dead serious...this is a growing trend and it's nuts.
5. Easy way to find out...have you Realtor pull up the Deed to the property and see who the CURRENT owner is...if it's a bank, then the foreclosure process is complete, if it's the owner, it's not.
THERE IS NO SUCH THING AS PRE-FORECLOSURE. That is a scam term used by people to make you think you are getting a deal. A home is either being foreclosed on or it's not.
14 years ago
1 It is getting faster. I waited 100 days for an answer on one house. I currently have been waiting 20 days on another. One bank switched the loan to Citibank and now Citibank made us rewrite our offer.
2 It's legal to make any offer. I am finding that i must offer 97% or more of the asking price to buy it. If i wait 30 days, the asking price is lowered and i can get it for 97% of the new price. Very frustrating.
3 The weakest buyers ask for closing cost help. Banks want the strongest buyers. But if you need help, ask for the money.
4 This is getting better. Our first closing was delayed 14 days past our target date because the bank was so swamped. Go slow about giving your 30 day notice.
5 Do not rely on the MLS info. It is just a box that is checked in a hurry. BUy only true repo's. Avoid pre-foreclosures or Short Sales.
14 years ago
J. Philip Real Estate
It is most likely an REO, or a foreclosure that Countrywide took back from a defaulted borrower. They won't sell to you unless they personally verify that you are qualified. You aren't obligated to go through them, but it is part of their due diligence.
You can make any offer you wish. The asset manager at the lender will either accept your bid or counter offer untill you have a meeting of the minds.
If it is an REO they'll respond fast and want to close ASAP. You are unlikely to run into red tape unless it is a short sale but most MLS systems require that a short sale be disclosed. This doesn't sound like a short sale.
They may do a seller's concession for closing costs but I wouldn't be terribly surprised if they did not.