So You Are A Real Estate Investor Who Want To Make An Offer On A Foreclosed House

I receive phone calls from real estate investors from time to time on properties I have listed on the Internet and one thing rings true about all of these Investors.... They have been sold on the disinformation being poured out by the so called real estate investment guru's who last year were selling some other form disservice to anyone who would come to their seminars and buy their materials.... So if you are an investor seasoned or novice then look at the issue from the lender's prospective....
A couple of points you need to know when truly making an offer on a foreclosed property...
•1. Cash is not king! A mortgage company does not frown on a mortgage. When you think about it that makes sense, once you look at from a mortgage company's point of view. They only care about the NET
•2. A quick decision in most cases is not possible, so do not threaten to walk if you do not get an instant response. The typical answer in anything under 10 days is good when dealing with a lender.
•3 It's all about the NET so inspections & warranties paid by the buyer increase the net and help the sales price
•4. The cost of the Buyer's agent is considered in the sales price and yes banks like you to have professional representation to protect your interest in the contract. Banks like to be covered and a Buyer's agent is a good thing!
•5. It takes time to remove all of the encumbrances and liens off of a deed so expect 21 to 30 days to close, not tomorrow!
•6.Yes in multiple offer situations a lender may consider an owner occupant over an investor. Remember that lenders usually have numerous properties in any given area or neighborhood & protecting the property value is a consideration.
•7. Repairs....not happening in 90% of any REO sale, unless the repair would prevent more or continued damage to the property. What your inspector or contractor says really does not influence the bank's decision. That information is for your decision.
•8. The first offer is rarely accepted unless it is of course for full price so be ready to counter and re-counter offers
When you take these items into consideration you will see that it is possible to buy an REO property and obtain a good deal if you work with the guidelines banks like to follow.
One other consideration; With the number of foreclosed houses on the market there is pressure to sell them but Lenders have hundreds of deals to consider ever day so keep your prospective and realize if you "Walk" if you do not have an answer by 5:00 today...they don't care.
•1. Be agreeable and willing to work with the Lender or Asset Company
•2. Be patient with the response time and how you respond in king to the Lender
•3. Be prompt with your information even if they are not prompt
•4. Be realistic with your pricing and what your costs will be, exaggeration kills many good deals
•5. Be flexible closing dates next week is not realistic and the day after tomorrow is not being flexible
•6. Be willing to walk away and willing to re-visit their offer if is remains available
•7. Remember banks are in the business to make money not lose money so they work with people who work with them
The really good investor has patience to seek out opportunity and the ability to pounce when it arises....