June 3, 2014

Foreclosure Pitfalls – Buying Bank Owned Properties Part II

Foreclosure Pitfalls – Buying Banked Owned Properties Part II

The following photos really illustrate how tricky the foreclosure market can be.  The damage in this property pretty much eliminates 75% of all qualified buyers as only very particular financing is available for this type of property.   What I could not capture in the photos is that this home is built on a hill and the whole front of this house is failing and sitting on unstable soil.  Prior Seller repairs cosmetically covered some of the evidence; unfortunately the next owner of this property will need to fix the hill, repair the foundation and the front walkways on this home.  

The numbered list corresponds with the pictures. The condition of Bank Owned – REO – Foreclosure  properties is very uncertain and if you plan to write offers on these properties, it is important that you take the right people with you.  Even more important you need to work with a real estate agent that can help pre screen these properties for serious issues.  There is no need to tie a property up into escrow only to cancel that escrow after spending money on inspections when many of these problems can be identified early.  Additionally, because lending is very tricky for these properties, your real estate agent can waste your time with these properties if your financing requirements do not match the property. 

The photos below show a home that was looted by the prior owner before leaving.

1. Master Bath Vanity and sink Removed.

2. Recessed Lighting Removed.

3.  Stove Removed.

4. Dishwasher Removed.

5. Master Bath tub Removed.

6. Air Conditioning Removed.

7.  More evidence on Air Conditioning Removed.

 

 

Foreclosure purchasing pitfalls

 

For the first part of the Series Foreclosure Pitfalls SEE: Top 3 REO Buying Pitfalls