6/7/2014 We bought a foreclosed home. This was our "First" time doing so.
I have bought and sold two homes in the past but never entered the land of buying a foreclosure.
I happen to have a "tenacious" spirit. Leave no rock unturned would be my motto when it comes to doing research and investigating any thing of interest to me.
Let's get into the "meat" of what to do. Cash is king and we did just that offered cash. If you can't I would best advised you to have your finacing already approved and ready before you look!
http://homepath.com is the Fannie May listings of foreclosed homes I used. They offer finacing as well. Real estate owned or REO is a term used in the United States to describe a class of property owned by a lender—typically a bank, government agency, or government loan insurer—after an unsuccessful sale at a foreclosure auction.
You found the house. Great! Now take the address information and head over to http://zillow.com and put in search bar. Scroll down the page, right under the facts section you should see a link or the words: County Website. Cllick on there. Now you are at county website it defaults to land on the "Property Feature" tab. You want to click on the tab next to it called "Sales Analysis". That is where you will see the history of the buyers and sellers. At the top you'll more then likely see a bank name in the buyer column. This is who currently holds the deed. This is who you want to contact. Find out who is the REO agent on this property. Call the bank and ask for the REO department. I had to google the bank name to find the headquarters and I had to reach out on social media through linkedin to get in touch with my REO agent. I just did a search on Linkedin. Some of you may not have a huge social presence to do this but more then likely you wont need to if you can get in touch with the headquarters of the bank.
I know most people are accustomed to having their realtor do all the contacting with listing agent. This is what you don't want to do leave it in their hands. I had to go above my realtors head because she did not want to offend the listing agent by going over his head to talk with the REO agent. Now here comes the "WHY" I did what I did and WON my bid.
In Orlando, Florida this was an area flooded with foreclosures and listings of such homes. The listing agents many times never even went to the house to show the property - they just put a lock box on it and would get dozens of other realtors to show the house and the listing agents office would be flooded with offers. Your Offer would get lost in the pile. The one house we had bid on previously that we did not get the winning bid on, was because it never got to the REO desk! Why? If you have 10 bids at the same high price why would that listing agent care that the REO even seen it? The listing agency still gets his cut of the commission. The listing sgent might pass 5-10 bids at random. There is no motivation on listing agent to submit all bids. Now moving forward to the second house that we did bid and win this is what made the difference.
Banks do NOT want to own property or to have a huge inventory. They are a business and do like to make profits but they focus on getting these homes unloaded the fastest way possible. A contract with NO INSPECTIONS and Cash Ready will get that REO agent ready to act on your bid!
I personally emailed the REO agent. Told him Why this home was imporatnt to me and included a picture of myself to put a face with my name and to be out in front of the rest. I explained to him that my reason for contacting him was that I felt I had a serious great cash bid with no inspections that he needed to see and that in the past my bid never made it to the table. My exact words went like this:
This is not an attempt to solicit the winning bid. This is not about winning or losing the bid on (address of foreclosed home) This is about you SEEING my bid. It's been brought to my attention not all listing agents play fair in submitting bids.
The REO agent called me and asked had I been in the house which I had not. He advised me that it is a rule that you have to sign papers you have been inside to view house. I explained the numerous calls my realtor had made to listing agent and no return calls. That time was running out and we could not get in. The Agent said he would make a call and I would get in immediately. Apparently the listing agent was not playing fair he had someone he was rooting for and had NOT placed a working lock box on house for anyone to get in. Then after we went, 2 days later we went with our realtor to get back in for some dimensions and the lock box code had been changed and no return calls to get back in. This confirmed that the listing agent was doing his best to keep the competition out.
I succeed in getting my bid on the table. We offered 15,000 more then the asking price. This is not the time to try to pay less then asking price with the competition so high. We wanted this house and we offered the max we felt we wanted to afford with no regrets. We didnt want to lose the bid and think later we should have offered more. Instead we offered our max and if we lost we knew we could have no regrets. We also offered no inspections which really went against all my previous convictions. My husband has a great eye for mechanics and knew this house structure was sound. You could have a seasoned inspector on your side to go with you when you view a home to get his best guidance but just dont put anything in the contract to have fixed. You having the home inspected gives you an idea if you can afford the fixes or will need additional funds if you win the bid.
Banks are a business they want a quick sale! Its not their business to have a huge inventory. You want your offer to be the most attractive offer. Cash deals tell the REO that the house can close in a matter of days and its done. Don't be dismayed if you have to finace a home if you can do it with out inspections you could beat a cash deal if they are asking for inspections and upgrades of the property.
If you lose a bid, learn from it. The first house I told you we lost I learned the house AC and furnace unit had been stolen! Something we didnt see. It also turns out we love the second house location and over all the house better then the one we didnt get! Deals come and go just be patient. Do your homework and by no means do not be intimidated to reach out to the REO Agent even if your realtor advises not to. My Realtor was impressed and she said she learned alot through my tenacious spirit.
A special friend of our family is in need of a liver which equals life.
I would not personally ask anyone to do this but this family has been laid on my heart. The husband worked 2 jobs until his health could no longer allow him to do it. His wife has always been a giver and she was upset that her daughter set up this website to help with her liver expenses. The finacial burden is huge and her husband has exhausted himself for love for his wife, but we the friends and family are the ones asking your help 5.00? 10.00? Prayers? Could you share this? Any help is VERY APPRECIATED!
Here is the story and link: