Pinetop White Mountain Blog

Buying Foreclosures!

Good Sunday Morning Everyone,

I read a lot of articles and blog posts about Buying Foreclosures and there is a common theme in many of them.  Frustration and anger from Buyers or Buyer's Agents that an offer was rejected or ended in a multiple offer situation requiring a higher bid or better terms from the prospective buyer.  Many times the buyer isn't even aware that there are other offers on the table. 

Here are the facts.  Buying a foreclosure while it may seem like a grand idea because the prices are so far below market, a buyer needs to be prepared for a very frustrating process.  Buying a foreclosure is not like buying a home being offered by an owner/seller.  The Banks don't care about who the Buyer is or what their motivation for buying is, they just want to unload a bad asset at the best price and terms possible.  As such, they will do everything they can to produce the best possible scenario for themselves and they won't even consider an offer that has any benefit to the buyer other than obtaining a property. 

The Agents representing the Banks can't do much to assist the buyer either.  They have their orders and their instructions from their Asset Managers on how to handle that asset, and they must abide by those guidelines or they risk losing their access to those listings.  That means that if they can, they are going to work very hard to produce the best contract they can.  If that means going out and shopping your offer to other Agents to generate multiple offers, that is what they will do.  The more offers they can submit, the better chance they have of finding the one the bank will like and work with. 

If you are a Buyer who is sure you want to buy a foreclosure, the first thing you need is a very good agent with experience representing buyers in foreclosure transactions.  You need someone representing you who has been down the road and knows what to expect.  Learning to deal with Banks in these transactions is a learning process and even agents learn something new with every transaction.  

You need to be receptive to the advice your agent provides and follow their guidance.  The objective is to get a strong offer on the table with as few possible hiccups as possible so you can get your offer accepted and buy the house.  Too many contingencies , too low an offer, or too many demands from the bank is only going to result is your offer being rejected out of hand.  Make your first offer your best offer and you have a good chance of getting your offer accepted, even if others are on the table.  If that doesn't happen, you can't take it personally.  To the Bank it is all about the numbers and if the numbers work, they are good.  If they don't, your offer will be passed over.  It is as simple as that. 

I didn't give specifics here because I simply can't.  Every Bank, every Bank Addendum, and every foreclosure transaction is unique unto itself.  If you would like assistance with this type of transaction, I can help.  The majority of my Buyer clients for the past two years have been with Bank Owned properties and I know how they think and what needs to be done to get your offer considered at the negotiating table.  They aren't always fun transactions, but I get them done.  

If you are ready to get started, give me a call.  I can help you negotiate the mystery world of foreclosures because I live it every day.

Thanks for reading, until next time.....

Sandra Paulow, Associate Broker, GRI, SFR, REALTOR®  (928) 242-0300

Your High Country Connection for the Listing and Sale of Real Estate!