Wednesday, December 9, 2009
It has happened more than once that nice families who are trying to get "the best deal they can" opt to buy bank owned properties, only to be surprised at the length of time it takes to get a response from the bank and end up being dislocated and in limbo at the banks mercy. Even when they have been counseled on the process and how long it may take. I hate seeing that! There is only so much a helpful real estate salesperson can do against a face-less entity that holds all the cards. If you are considering purchasing bank owned properties (also known as REO's) please heed this warning: Plan for the buying process to take 3 - 6 months, really. Have a plan for where you will live in the mean time from the time you sell your current home to the time you can close on the REO and move in. [You will probably have to close on your current home before closing on the REO to satisfy the bank]. Figure out where you will store all your belongings. Budget carefully, there will be repairs that the bank will not fund but your new lender will require and unless you do you those repairs (at your expense) you will lose the house and most likely all the earnest money you paid up front, which sometimes can be a substantial amount of money! There are no shortcuts. There is no easy way around an REO, contrary to some of the ads you see out there today. Granted the "deals" are great, but assess carefully if you have the time, money and grace under pressure to stand the test of time. Celebrating your thanksgiving, eating MacDonald's, in a tiny hotel room is not a memory your kids will cherish. The best I can do is prepare my clients and walk them through it. If you still think buying REO's (bank owned properties) may be for you, contact me, let's talk then get shopping! Now is a great time to aquire these unique properties, if you are prepared.