The question of the day came to me when I was viewing one of the REO properties that the bank allows us to sell. Walking through I noticed the typical things, dirty, trash and unkept. However, it’s the other “typical” things may surprise you. There had been installed speakers in the walls – they had been taken leaving holes. The Garage had been converted into a type of office – with the main “two car” portion of the door having been sealed up.
The pool had not been attended to and the over 2 acre property needs to have the grass cut badly. While leaving the property, heading to this Starbucks in Moorpark to type this, I flagged down some gardeners. Antonio was his name and he was a licensed and bonded gardener. 🙂 I found this out via the translator, his business partner, he called on the phone after we pulled over by the side of the road to talk.
It’s pays to be in the right place at the right time, yes? This property had an inordinate amount of trash too. 🙂 I already have someone for that.
Here is how most banks operate when it comes to repairs, fixes and handling of their Real Estate owned assets. After their agent, in this case it’s Paris and I, are able to get inside the property, they give a run down of repairs, trash, and other notable items to bring the property to a level that can be financed.
The price is then established in accordance with the current market. If the market is increasing in value – that number will factored into the current pricing strategy based on a 90 day in the future estimate. If the market is declining as a whole, then that number is factored into today’s fair marked value (FMV) and penciled out at a 90 day estimate. That 90 day in the future estimate of value is where most of the REO’s and Bank Owned Foreclosures are listed for.
When it come to repairs on these properties – that is also included in the agent’s recon. They will give an estimate and bids for repairs to the subject property. In the case of this REO, they have ripped out the flooring in some of the rooms. I know FHA will not finance a property with an exposed slab. The same holds true of VA loans. Therefore, if the Asset Manager at the bank wants to allow for those types of loans to be accepted, they are going to have to pony up for the flooring and holes in the walls.
While in escrow on a Bank owned property, you are going to want to make sure you are working with a Foreclosure Expert. The reason for this is due to the “timelines involved”. When should you, as a buyer of a foreclosure or reo property, ask for any repairs or further discounts? Although properties are always sold “as is”, is there a better time to ask or should you ask in the first place?
There are differing options on this front. Some think they should not make waves. Some agents say that you never get anything if you don’t ask. (I like the second type of agent)! If you want to view the foreclosures that are in the Santa Clarita Valley – please head over to Paris911 Dot com and click on the “Foreclosure” link on the side. This will show you all of the Foreclosures and bank owned real estate currently for sale in the SCV and in the rest of Southern California.
We have also posted our Foreclosure Radar Resource on the home page of the Main Santa Clarita real estate website. All you have to do to access that resource is to scroll down from the point of the internet Data Exchange map that is posted front and center on the home page of Paris911 dot com. Below the updated video, you will see a large map with a place that you can type in a city name or zip code. You will also see three choices for distressed properties. You can choose for the “off market” bank owned real estate. You can also check out the Notice of Default listings – aka pre foreclosures. Auctions are also represented in the Cities of Santa Clarita and Beyond.
I’d like to point out – you are going to be seeing a majority of Auctions when you run these searches. That is because of the drive toward Bulk Selling of the REO inventory by some of the banks, investment groups and hedge funds. Stay tuned for more intel about that by Subscribing to our Real Estate intel newsletter. You can get subscribed to that by entering your email address below this text and thanks for reading.
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