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Foreclosure and Short Sales
Buying Tips |
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1. Work with an agent who has experience dealing with bank foreclosures.
The purchase of a bank foreclosure
involves similar fundamental real estate transaction processes as a normal sale, but it is important to understand the critical differences, and how
following practical rules can help you get you the best deal and avoid some very costly
mistakes.
2. Get pre-approved for a Loan
before you
seriously look for that
good deal.
ALL banks require a pre-approval letter stating that
you have the financial capability to finance the purchase of one of their
foreclosures. Some larger banks will also require you to pre-qualify through one
of their loan officers to insure your ability to close the deal. You will not be
required to finance through that bank.
When making an offer on a short sale, it's
often strategically helpful to be pre-approved through the bank selling that
short sale. During negotiations, this may tip the scales in your favor.
If you intend to pay cash, a proof of
funds letter will be necessary to submit a purchase offer.
It is very important to pre-qualify for a
loan before you seriously start looking for the right deal. You're not the only
person out there looking; many times your success will dependant on good timing.
If an offer is accepted before yours, any possibility of acquiring the
property after that point will be extremely remote.
3. In General, Bank-owned Foreclosures close much faster then Short Sales.
Short Sale properties can produce good value for homebuyers, but they can also
take an extremely long time to close, in some cases, months. Short Sales
continue to maintain a very low priority for banks when it comes to attention
and a timely closing...there are few exceptions.
Bank owned
foreclosures however are a different story altogether; during negotiations the
bank generally attempts to expedite the closing, in part to conclude their
investment losses and secondly to insure the house will go back on the market as
soon as possible should the transaction go south.
4. Always offer less than the asking price.
Don't assume that banks are firm on their price. The majority of foreclosures
are liquidated through the use of an asset manager. These managers are usually
given authority to negotiate the asking price down to a predetermined minimum;
any offer less then that minimum amount must be submitted back to the investors
for deliberation. There are many factors to consider when preparing to submit an
offer to buy a foreclosure.
5. Ask the bank to pay some of your closing costs. Some Will.....Some Will
not.
If you are trying to keep your closing cost as low as possible, you may want to
consider offering a little more for the house and asking the bank to pay for a
portion of your closing fees. Some banks have a policy preventing this practice
but it can be worth an attempt, the worst that can happen is that they will say
no. In certain cases the bank can be quite accommodating.
6.
Where do I
start?
Are you ready to buy a foreclosure in Frisco or any other North Dallas
Location? call 214-336-7088 or e-mail me at
jay@foreclosuresfrisco.com. We can discuss the
possibilities and get you started right away.
Frisco Foreclosures offer a tremendous amount of value, we also service Allen,
McKinney, Prosper, Plano, Lewisville, The Colony, Sachse, Wylie, Murphy,
Richardson, Carrollton, Flower Mound, and many other Dallas Fort Worth
locations.
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