Buying a bank owned home or a short sale property is not as glamorous as one may think. Yes, you will likely get a fantastic deal, but not without a headache. Almost all of these properties come with major baggage and are not for the faint of heart. This is where a great, seasoned Realtor comes in to help you avoid the pitfalls.
It is so important for buyers of these types of properties to utilize the resources of a good real estate agent…truly. Any agent that has handled a bank repo or short sale transaction at least a dozen times, should be able to guide you through this process with some sort of ease. When buying a repo, you are getting the home “as is”. This equates to “the bank’s way or the highway”. Once you negotiate price, the bank will follow up with 6 gazillion pages of addendums, saying that they are not responsible for anything, and the property is “as is”. They really like that statement, “as is”, and can come up with about 100 different ways to state that. This is where things can start to get weird. Some banks, recently, are trying to make earnest money deposits non-refundable. Some are not paying for title insurance (which protects the property from liens, assessments etc.). My favorite one is when banks try to charge the buyer a per diem charge (usually $100-$200/day) if your loan does not close on time. This is comical because the banks are usually the hold up on closing, yet want to charge you if the closing gets delayed. I digress…. Banks are only looking to liquidate an asset. Their only concerns with a buyer are how much are they willing to pay, and how are they going to pay for it. The banks already know that the home needs work, smells like pets and has busted pipes, trash, mold, broken windows and as a bonus, no kitchen appliances, but they don’t care. They are in it to move the property and clear it off the books.
An experienced agent will help you navigate through all of the addendums, inspections, deadlines, settlement statements, utility transfers, insurance questions, and so much more. DO NOT try this on your own. Really, do not. Ask a lot of questions of your agent up front. If they are vaguely familiar with the processes involved, sorry, you should move on to someone with more experience….like me!
Amy Green
Real Estate One
231-633-0808
amygreentc@yahoo.com
www.traversecityrepos.com
