Here are some tips to consider:
1. Work with a Realtor who has access to foreclosure information.
Many home buyers assume that all agents have access to foreclosure listings. It’s important to ask. I have access to foreclosed, short sale and HUD properties.
2. Bank-owned properties generally close faster than short sales.
While short sales can be bargains, they also can take a lot longer. Some banks will negotiate in a timely manner on short sales, but most will prioritize properties they have already repossessed. Your Realtor can assist you with more information regarding properties.
3. Yes, you can negotiate the asking price.
Don’t assume that banks are firm on their price. For example, asset managers responsible for liquidating bank-owned homes are often willing to consider a lower offer. They are financial managers and have a bottom line but in most cases are willing to negotiate.
4. The Bank may pay closing costs and offer a 2 year home warranty. Ask!
The worst that can happen is that they say no. Sometimes buyers are surprised to find that banks can be quite accommodating when they want to. Be sure to place all of your requests in the original offer to purchase. No matter the amount of counter offers, if it is not in the original offer you cannot go back and add it later.
5. Get pre-approved by a Bank prior to starting your search.
When writing an offer on a foreclosed property you have to include a pre-approval letter from a Bank. No offer can be made without one. It is also a smart process for any Buyer to complete because it will determine how much you can purchase and tell you what your monthly payments will be. If you find a home you want to be able to write on it that day- any delays could place another buyer in front of you.
