The buzzword in today’s real estate market is Foreclosure. Here are some 5 tips to buying a foreclosure.

1) Don’t assume all foreclosures are great deals.

Just because it is a foreclosure does not mean that it is a great deal. I have seen many over priced bank owned properties. Many of the smaller community banks are overpricing their properties.  While the Fannie Mae and Freddie Mac properties seem to be priced more aggressively. Hire a good Realtor and learn the market.

2) Don’t buy in the wrong area.

Location is still the most important thing in real estate. Just because you found a foreclosure in a less than desirable area doesn’t mean you should buy it. A good investment is finding an aggressively priced bank owned property in a good location. Price is not the only factor when buying a home.

3) Get an inspection

You need to know as much as possible about the home BEFORE you own it. Make sure you get it thoroughly inspected. Make sure your purchase agreement has an inspection clause.

4) Get a title search

Make sure your title company or the attorney representing you does a title search. Title insurance is worth the investment.

5) Hire a good attorney

It is good to have experts on your side. They are like insurance. Most of the time you don’t need them but the one time you do it is really good to have them. Be wise and surround yourself with experts – Realtor, Attorney and Inspectors.

There are some good deals out there in the foreclosure market. However, you should not ignore a great property with a realistic seller that is price right. You can still find a good deal with a traditional seller. Good luck.

Marc Rasmussen

Sarasota houses

Thinking of buying a foreclosure? Well, if you are you looking to buy a home you might as well look at the bank owned properties for sale. There are plenty of bargains out there to be had on foreclosed properties. Here are 5 tips to buying a foreclosure.

1) Educate yourself on the market

This really goes for just buying in general. It is important to be knowledgeable about the market, neighborhoods, recent sales etc. Find yourself a good Realtor who knows the market. They can help you by sending information on sold properties and other market statistics. Just because a property is owned by a bank doesn’t mean you should buy it. If you buy in an area that’s losing jobs and is riddled with crime, home values are likely to take a lot longer to recover.

2) Get financing first

This is crucial. Lending guidelines have changed over the years. It is harder to get money to buy a home. It may even be harder to finance a bank owned property depending on the neighborhood, condition of home and current market conditions. Make sure you are pre-approved for a mortgage so you are not wasting your time.

3) Finding a foreclosure

You can sign up on various foreclosure websites like Realtytrac.com or Foreclosure.com. There is a charge to be a member of those sites. Most bank owned properties are listed on the MLS so if you are working with a Realtor they can help you find foreclosures as well. It is good to have a Realtor so you can also look at homes being sold by private sellers as well. Sometimes those are the best deals.

4) Get Inspections

When people have trouble paying their bills often times they don’t maintain there home like they should. Don’t assume the bank knows much about the condition of the home. If you are under contract on a foreclosure make sure you get inspections done. It is best to know what is wrong with the home before you buy it. It may seem like a lot of money to hire inspectors but that money could be a drop in the bucket compared to the money you have to spend to fix something.

5) Hire an attorney

When you are under contract on a foreclosure make sure you hire an attorney to represent you in the closing. It is just good to have someone on your side reviewing the closing documents. Don’t assume the bank is going to always do the right thing. The expense could be well worth the money.

Marc Rasmussen

Sarasota Foreclosures

1)    Getting a mortgage is easy

Financing is not easy these days. I currently have some clients under contract trying to buy a vacation condo on the beach. My clients have great credit, make a good living and are putting 20% down. It is still questionable as to whether they will get money to buy the property. The problem is that it is a condo in Florida and banks have tightened their lending guidelines on these properties.

With that being said there are some great loan programs available. For some financing is relatively easy. If you are a first time home buyer, have great credit, money for a down payment, buying within your means and a primary residence you should be able to get a mortgage.

2)    Homes aren’t selling

This is not true either. Homes are selling out there. Depending on where you are in the country sales are relatively active. Obviously, some areas are going to be better than others. I heard on the nightly news the other night that sales on a national lever were up. Keep in mind real estate is local so you need to find out what is happening in your area. Inventories might still be high but there is a lot of demand for a properly priced property. Talk to a competent Realtor to find what is happening in your market.

3)    Foreclosures and short sales are the only properties to consider

Foreclosures and short sales make up a good portion of the sales today. There are some great deals to be found in foreclosures and short sales however there are also some great properties available for sale that are not bank owned or short sales. Don’t ignore these properties. If you are looking to buy a home hire a good Realtor that will narrow down your best options which will include bank owned properties, short sales and realistic sellers who are not upside down.

4)    Realtors are not busy

Every now and then I get a wise guy that thinks he can walk all over me because he thinks I have nothing to do. They tend to speak down to me, want to be catered to, their needs and wants go over and above what is required from a Realtor and have little or no respect for my time. Fortunately, I am busy enough to fire these types of buyers and sellers. Don’t make the assumption that all Realtors are twiddling their thumbs in the office.

What misconceptions are you running into today?

Marc Rasmussen

Realtor in Sarasota, Florida

Sarasota real estate

1. The housing market won’t be quite as newsworthy

You will be able to listen or read the news and not hear words like ‘foreclosure’, ‘bailouts’ or ‘housing bottom’.

2. Balanced market

Real estate prices are derived by supply and demand. If the demand is high and supplies are low prices rise. If supplies are high and demand is low prices drop. Your market will bottom out when inventories have dropped to and there is a greater balance between supply and demand. The real estate industry says that 6-7 months represents a balanced market.

3. Investors

More investors will feel comfortable about investing in houses. When you see a good number of investors (no flippers) buying good values than the market is bottoming or is about to bottom out.

4. Lenders will loosen up

The real estate market depends on people’s ability to get financing. There are only so many cash buyers to go around. The banks are very nervous right now and rightfully so. Banks want to lend money but they don’t want to make any bad loans. When you see the banks loosen with their lending guidelines that is a pretty good indication that they think the market has stopped falling or will stop falling soon.

5. Optimistic

More and more people will be optimistic about the future. There are many people buying houses and stocks and these historically low levels. If the market prices get back to where they were, regardless if it takes 5, 10 or 20 years, there will be a lot of wealth created.

There will be more than just 5 signs to signify the housing bottom. I am a Realtor in Sarasota, Florida and I am seeing signs of a bottom:

• Our inventory levels are much lower (not quite low enough yet).
• I wouldn’t classify lending as loose but it is a little easier to get a loan today than 6 months ago
• I am seeing more optimism in the market as these bottoming signs are appearing and home buyers are getting great values.

What is happening in your market?

Sarasota real estate

Buyers Beware! The disturbing trend of low ball listings in Las Vegas!

A disturbing practice I am seeing more and more of lately is the low ball listing of Las Vegas short sale/foreclosed properties. A low ball listing is a listing that is priced, by the Listing Agent, SUBSTANCIALLY below what a common sense comparative market analysis says the property is really worth.

I have spoke to many Las Vegas Listing Agents and asked them why they priced their listings so artificially low. They tell me they were not getting any offers at a higher (more realistic) price. OK, I understand that logic but are they really helping to sell the listing any faster with an unrealistic price.

I would argue that low balling the listing doesn’t help sell the property any quicker and in fact hurts the chances of a sale for the following reasons:

1. Buyer expectations–The Buyer sees the artificially low price and thinks they can get the house for that amount. Even after it is explained that the Seller’s Bank has the final say on what they will or will not accept, this is a difficult psychological hurdle to latter overcome.
2. Wasted Time–So the low offer is in and the waiting begins. Banks are not known for quick decisions and several weeks could go by before they respond to the offer. During this time the Listing Agent is required to place the property as Contingent in the Multiple Listing Service (MLS). This could lessen the chance of the property being shown since other potential Buyers could see the property as possibly being sold already. It is also against Nevada law for the Listing Agent to submit other offers while the first offer is pending review by the Bank. Many times the offer will come back from the bank 10% or more higher than what the Listing Agent had it listed for. This tends to anger the Buyer and often causes a complete breakdown of negotiations.

The best way to mitigate against this practice is to educate the Buyer in advance. Las Vegas Buyer’s Agents need to prepare their clients for the possibility of a counter offer above the listing price. If the comparative market analysis shows that the property is worth more than the asking price, share this with your client, it might be what saves the deal in the end.