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Well, the townhouse I have had my eyes on for months just reduced its asking price from $124,500 to $114,900!!! It’s a foreclosure in move in condition and would be a great starter home, but my scores are not cooperating and my 2 year discharge date isn’t for another 2 months. I'll be devastated if someone buys it, but expectation leads to disappointment.
Anywho, I do have questions...
is it possible to negotiate the asking price on a foreclosure?
Since the seller is technically the bank, is it possible for the bank to pay or contribute to closing cost?
What advice do you have for buying foreclosures?
There's an exact townhouse that looks exactly like this one priced at $129,000 and has been on the market for 310 days, should I just go for that one in May?
Any other comments, advice, etc are welcome!
@GirlMelanie89 wrote:Well, the townhouse I have had my eyes on for months just reduced its asking price from $124,500 to $114,900!!! It’s a foreclosure in move in condition and would be a great starter home, but my scores are not cooperating and my 2 year discharge date isn’t for another 2 months. I'll be devastated if someone buys it, but expectation leads to disappointment.
Anywho, I do have questions...
is it possible to negotiate the asking price on a foreclosure?
Since the seller is technically the bank, is it possible for the bank to pay or contribute to closing cost?
What advice do you have for buying foreclosures?
There's an exact townhouse that looks exactly like this one priced at $129,000 and has been on the market for 310 days, should I just go for that one in May?
Any other comments, advice, etc are welcome!
Have you asked TU, EQ & EX for an early deletion on the discharge? I'm not positive on the length of time but I know they will work with you if it is within a certain amount of time.
that's what I get for reading on my phone
Lol. Happens to me all the time!!!!
Yes, it is possible to negotiate the price on a f/c. Depends upon the market where the property is located. Some asset managers price the asset (property) high relative to the market and others price the asset low to gain attention and to get multiple offers above list price. Talk with your agent to see where this one is in the market based on its condition and the price of the others and their condition.
Yes, asset managers will accept offers with a seller concession. The max is 3% of contract price toward buyers costs. Some of the f/c properties have the buyer pay additional costs to close. For example, fannie mae won't pay doc stamps and they push that cost over to the buyer. You need to find out what your total cost will be on that particular property. The listing agent usually posts the information in the document section of the MLS that your Realtor can access.
By the way, do not make an offer using the listing agent as your agent on a foreclosure. In foreclosures the listing agent has a fiduciary duty to the seller only, even at buyers expense. You need an agent to help you navigate the f/c process and get as good a price as you can get on the f/c so find a buyers agent to work with that is not the listing agent and preferably doesn't work in the listing agents office.
As to losing funds if you don't qualify for financing - almost all of the contracts have a finance contingency clause where you would get your EMD back. There are a few contract forms with some lenders, mainly auction types, that have fees that are non-refundable (Hubzu is big on keeping those deposits). So make sure to read whichever contract and addendum you are to sign before you sign so you know your exposure.
@StartingOver10 wrote:Yes, it is possible to negotiate the price on a f/c. Depends upon the market where the property is located. Some asset managers price the asset (property) high relative to the market and others price the asset low to gain attention and to get multiple offers above list price. Talk with your agent to see where this one is in the market based on its condition and the price of the others and their condition.
Yes, asset managers will accept offers with a seller concession. The max is 3% of contract price toward buyers costs. Some of the f/c properties have the buyer pay additional costs to close. For example, fannie mae won't pay doc stamps and they push that cost over to the buyer. You need to find out what your total cost will be on that particular property. The listing agent usually posts the information in the document section of the MLS that your Realtor can access.
By the way, do not make an offer using the listing agent as your agent on a foreclosure. In foreclosures the listing agent has a fiduciary duty to the seller only, even at buyers expense. You need an agent to help you navigate the f/c process and get as good a price as you can get on the f/c so find a buyers agent to work with that is not the listing agent and preferably doesn't work in the listing agents office.
As to losing funds if you don't qualify for financing - almost all of the contracts have a finance contingency clause where you would get your EMD back. There are a few contract forms with some lenders, mainly auction types, that have fees that are non-refundable (Hubzu is big on keeping those deposits). So make sure to read whichever contract and addendum you are to sign before you sign so you know your exposure.
Man this was a very informative response! You Rock @StartingOver10! I will take all of this advice and apply it towards the process if I get a pre-approval. Thank you so much!!!
@GirlMelanie89 wrote:Well, the townhouse I have had my eyes on for months just reduced its asking price from $124,500 to $114,900!!! It’s a foreclosure in move in condition and would be a great starter home, but my scores are not cooperating and my 2 year discharge date isn’t for another 2 months. I'll be devastated if someone buys it, but expectation leads to disappointment.
Anywho, I do have questions...
is it possible to negotiate the asking price on a foreclosure?
Since the seller is technically the bank, is it possible for the bank to pay or contribute to closing cost?
What advice do you have for buying foreclosures?
There's an exact townhouse that looks exactly like this one priced at $129,000 and has been on the market for 310 days, should I just go for that one in May?
Any other comments, advice, etc are welcome!
I bought a foreclosure condo over the Summer from a bank and got a super deal. I offered the price they were asking for and it was accepted. Other bidders were investors, and they didn't want to sell it to an investor. The condo appraised for $8,000 more than the asking price. Since the prices of homes has increased so much in South Florida my $110,000 investment is worth about $130,000 now. The only caveat about purchasing a condo is dealing with the HOA. Depending on what type of loan you're getting the HOA has to meet Freddie/Fannie condo guidelines if your lender plans to sell the loan. Another caveat, a foreclosure doesn't inheret Homestead Exemption from the previous owner.