There’s a ring of truth to the saying “When a door closes, a window opens.” If you’re a home buyer who is in it for profit and equity, then a short sale property is what you need. If you want to buy a home that might fall into foreclosure because of dire straits, think of this as an opportunity to work with a real estate company who can help you get what’s right for it in terms of buying price. Do not rush into it just because you see that it’s located on a cul-de-sac. Just be ready because this is one short sale that might take weeks and months to complete with the all the bidding, inspecting, and paperwork concerned.
When your goal is to buy a home on short sale for better profit and instant equity, you might want to get reacquainted about the process right here!
- Work with an REO Specialist. Okay here’s what you need to know about real estate agents. Some of them might fib and fabricate and present you with a certificate that they completed REO training. Training does not translate to being a specialist. Here’s how you can make sure he is a genuine REO Specialist:
- He has successfully transacted a minimum of 100 foreclosures or short sale homes. Any number less than that is bogus.
- He is listed with the local HUD or Housing and Urban Development agency. There are also agents who are listed with the local banks. This is a big deal because not every real estate agent gets on the list.
- Make sure you have the funds for it. Paying for the value of the home even at its lowest bid is not all there is to it. There are per diem fees and foreclosure fees that will have to be settled as well. That said it is to your advantage to have something extra in your bank account to make the sale official and complete.
- Get the bids on the property. As soon as you have an REO Specialist working for you and he was able to secure a list of properties to choose from, what you need to find out next is whether there are bids on the property and how much these bids are from the lowest to the highest; from its original price down to its discounted price. On the reverse, there might not be bids at all. Before you even show up to look at the property, you have to know the numbers that are currently on the table.
- Make a lowball bid. Here’s a juicy tip. If you find out that a house has been collecting dust for months now without someone snapping it up, this is your opportunity to strike and make a lowball bid. The home is most likely overpriced, thus the lukewarm response.
- Once you win a bid, find a home inspector straightaway. Like really now as soon as you win a bid. The home inspector will let you know about the true condition of the home that you just won by outbidding the rest. You think the bank will let you know if there is a massive termite infestation in the home that you just claimed? Nope. So it is your duty to find out so that you can back out within the seven-day period to get your money back. Caveat: Despite pulling or backing out on time, it will take a few months to get your money back because of the same process that will be applied by the bank for releasing your money.
- Do not go beyond the foreclosure period. The per diem and foreclosure fees will be staggering if you hold off on signing a contract. Anywhere from $100 to $150 a day will be charged to you if you sit on the contract.
Lastly, keep the transaction professional at all times. This includes not going straight to the owner of the home that you are eyeing to “fix things or initiate a cloak-and-dagger-transaction.” If you give your money to the owner of the home, who is also the seller, and who is also in need of cash, well, be prepared to get hustled down the road.