Home › Forums › Closed Forums › Buying and Selling RE › Advantages of a foreclosure specialist?
- This topic has 20 replies, 5 voices, and was last updated 16 years, 4 months ago by (former)FormerSanDiegan.
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December 16, 2007 at 11:26 PM #11236December 17, 2007 at 7:29 AM #118837BugsParticipant
First time buyers and foreclosure properties are really not a good combination.
With that said, what happens during a bust market is that eventually the foreclosure properties add up and basically drive the market. If 30+% of all sales are liquidations they tend to drive the pricing for most of the remaining 70% of the properties that do sell.
That means that if you stick around long enough you’ll get the benefits (low price) of a liquidation sale without having to deal with a lot of unforseeable problems that those properties sometimes have.
December 17, 2007 at 7:29 AM #118970BugsParticipantFirst time buyers and foreclosure properties are really not a good combination.
With that said, what happens during a bust market is that eventually the foreclosure properties add up and basically drive the market. If 30+% of all sales are liquidations they tend to drive the pricing for most of the remaining 70% of the properties that do sell.
That means that if you stick around long enough you’ll get the benefits (low price) of a liquidation sale without having to deal with a lot of unforseeable problems that those properties sometimes have.
December 17, 2007 at 7:29 AM #119002BugsParticipantFirst time buyers and foreclosure properties are really not a good combination.
With that said, what happens during a bust market is that eventually the foreclosure properties add up and basically drive the market. If 30+% of all sales are liquidations they tend to drive the pricing for most of the remaining 70% of the properties that do sell.
That means that if you stick around long enough you’ll get the benefits (low price) of a liquidation sale without having to deal with a lot of unforseeable problems that those properties sometimes have.
December 17, 2007 at 7:29 AM #119045BugsParticipantFirst time buyers and foreclosure properties are really not a good combination.
With that said, what happens during a bust market is that eventually the foreclosure properties add up and basically drive the market. If 30+% of all sales are liquidations they tend to drive the pricing for most of the remaining 70% of the properties that do sell.
That means that if you stick around long enough you’ll get the benefits (low price) of a liquidation sale without having to deal with a lot of unforseeable problems that those properties sometimes have.
December 17, 2007 at 7:29 AM #119065BugsParticipantFirst time buyers and foreclosure properties are really not a good combination.
With that said, what happens during a bust market is that eventually the foreclosure properties add up and basically drive the market. If 30+% of all sales are liquidations they tend to drive the pricing for most of the remaining 70% of the properties that do sell.
That means that if you stick around long enough you’ll get the benefits (low price) of a liquidation sale without having to deal with a lot of unforseeable problems that those properties sometimes have.
December 17, 2007 at 10:06 AM #118986XBoxBoyParticipantAre traditional realtors adverse to showing foreclosed properties (REO’s) to buyers? I’ve heard that REO’s typically only pay very low commissions, so many realtors won’t take their clients to them. Is there any truth to this? Are there agents that specialize in taking clients to foreclosures and help client with buying foreclosures?
XBoxBoy
December 17, 2007 at 10:06 AM #119120XBoxBoyParticipantAre traditional realtors adverse to showing foreclosed properties (REO’s) to buyers? I’ve heard that REO’s typically only pay very low commissions, so many realtors won’t take their clients to them. Is there any truth to this? Are there agents that specialize in taking clients to foreclosures and help client with buying foreclosures?
XBoxBoy
December 17, 2007 at 10:06 AM #119152XBoxBoyParticipantAre traditional realtors adverse to showing foreclosed properties (REO’s) to buyers? I’ve heard that REO’s typically only pay very low commissions, so many realtors won’t take their clients to them. Is there any truth to this? Are there agents that specialize in taking clients to foreclosures and help client with buying foreclosures?
XBoxBoy
December 17, 2007 at 10:06 AM #119194XBoxBoyParticipantAre traditional realtors adverse to showing foreclosed properties (REO’s) to buyers? I’ve heard that REO’s typically only pay very low commissions, so many realtors won’t take their clients to them. Is there any truth to this? Are there agents that specialize in taking clients to foreclosures and help client with buying foreclosures?
XBoxBoy
December 17, 2007 at 10:06 AM #119213XBoxBoyParticipantAre traditional realtors adverse to showing foreclosed properties (REO’s) to buyers? I’ve heard that REO’s typically only pay very low commissions, so many realtors won’t take their clients to them. Is there any truth to this? Are there agents that specialize in taking clients to foreclosures and help client with buying foreclosures?
XBoxBoy
December 17, 2007 at 10:16 AM #119006SD RealtorParticipantxbox –
Not at all (at least IMO). Commissions on REO properties (at least from my experience) are very competitive. Short sales are a little dicey because the lender approves a lump sum.
For instance, on a short sale (on the listing side) when you do get an offer, you send the lender everything, the listing agreement the contract, every single thing about the home, (this is on top of the ton of docs that the seller needs to deliver) and the lender will then make an analysis. The lender comes back with a number in terms of what they will accept. So lets say you have a seller with two loans, 500k and 100k and an offer of 420. Say the listing agent has a contract for 2% and the coop commission advertised is 2%. Now the lender takes all this into account along with an estmated HUD that you the listing agent send.
So the lender comes back and says okay we will accept x$ for the first, and x$ for the second (loans that is). Now the short sale asset manager will build in the commissions and estimated closing costs as well. So lets say out of the example above the lender comes back with a response that says we will accept 395k for the first, 1k for the second. Thus there is essentially 24k left over to be used for commissions, other closing costs etc… If it was short, then the agents need to work out a split somehow.
REO properties are sticky for lack of disclosure purposes and liability releases more then anything else. You will be informed that the lender is basically released from all liability because they have no clue about the home. It is not much different then buying a home from a trustee or probate sale. You need to be extra diligent with respect to your own inspections/diligence etc…Also you WILL be presented with lots of liability release docs that are well outside the scope of a normal resale transaction.
Once more this is all just my opinion. Yet I see plenty of REO with competitive commissions.
SD Realtor
December 17, 2007 at 10:16 AM #119138SD RealtorParticipantxbox –
Not at all (at least IMO). Commissions on REO properties (at least from my experience) are very competitive. Short sales are a little dicey because the lender approves a lump sum.
For instance, on a short sale (on the listing side) when you do get an offer, you send the lender everything, the listing agreement the contract, every single thing about the home, (this is on top of the ton of docs that the seller needs to deliver) and the lender will then make an analysis. The lender comes back with a number in terms of what they will accept. So lets say you have a seller with two loans, 500k and 100k and an offer of 420. Say the listing agent has a contract for 2% and the coop commission advertised is 2%. Now the lender takes all this into account along with an estmated HUD that you the listing agent send.
So the lender comes back and says okay we will accept x$ for the first, and x$ for the second (loans that is). Now the short sale asset manager will build in the commissions and estimated closing costs as well. So lets say out of the example above the lender comes back with a response that says we will accept 395k for the first, 1k for the second. Thus there is essentially 24k left over to be used for commissions, other closing costs etc… If it was short, then the agents need to work out a split somehow.
REO properties are sticky for lack of disclosure purposes and liability releases more then anything else. You will be informed that the lender is basically released from all liability because they have no clue about the home. It is not much different then buying a home from a trustee or probate sale. You need to be extra diligent with respect to your own inspections/diligence etc…Also you WILL be presented with lots of liability release docs that are well outside the scope of a normal resale transaction.
Once more this is all just my opinion. Yet I see plenty of REO with competitive commissions.
SD Realtor
December 17, 2007 at 10:16 AM #119172SD RealtorParticipantxbox –
Not at all (at least IMO). Commissions on REO properties (at least from my experience) are very competitive. Short sales are a little dicey because the lender approves a lump sum.
For instance, on a short sale (on the listing side) when you do get an offer, you send the lender everything, the listing agreement the contract, every single thing about the home, (this is on top of the ton of docs that the seller needs to deliver) and the lender will then make an analysis. The lender comes back with a number in terms of what they will accept. So lets say you have a seller with two loans, 500k and 100k and an offer of 420. Say the listing agent has a contract for 2% and the coop commission advertised is 2%. Now the lender takes all this into account along with an estmated HUD that you the listing agent send.
So the lender comes back and says okay we will accept x$ for the first, and x$ for the second (loans that is). Now the short sale asset manager will build in the commissions and estimated closing costs as well. So lets say out of the example above the lender comes back with a response that says we will accept 395k for the first, 1k for the second. Thus there is essentially 24k left over to be used for commissions, other closing costs etc… If it was short, then the agents need to work out a split somehow.
REO properties are sticky for lack of disclosure purposes and liability releases more then anything else. You will be informed that the lender is basically released from all liability because they have no clue about the home. It is not much different then buying a home from a trustee or probate sale. You need to be extra diligent with respect to your own inspections/diligence etc…Also you WILL be presented with lots of liability release docs that are well outside the scope of a normal resale transaction.
Once more this is all just my opinion. Yet I see plenty of REO with competitive commissions.
SD Realtor
December 17, 2007 at 10:16 AM #119214SD RealtorParticipantxbox –
Not at all (at least IMO). Commissions on REO properties (at least from my experience) are very competitive. Short sales are a little dicey because the lender approves a lump sum.
For instance, on a short sale (on the listing side) when you do get an offer, you send the lender everything, the listing agreement the contract, every single thing about the home, (this is on top of the ton of docs that the seller needs to deliver) and the lender will then make an analysis. The lender comes back with a number in terms of what they will accept. So lets say you have a seller with two loans, 500k and 100k and an offer of 420. Say the listing agent has a contract for 2% and the coop commission advertised is 2%. Now the lender takes all this into account along with an estmated HUD that you the listing agent send.
So the lender comes back and says okay we will accept x$ for the first, and x$ for the second (loans that is). Now the short sale asset manager will build in the commissions and estimated closing costs as well. So lets say out of the example above the lender comes back with a response that says we will accept 395k for the first, 1k for the second. Thus there is essentially 24k left over to be used for commissions, other closing costs etc… If it was short, then the agents need to work out a split somehow.
REO properties are sticky for lack of disclosure purposes and liability releases more then anything else. You will be informed that the lender is basically released from all liability because they have no clue about the home. It is not much different then buying a home from a trustee or probate sale. You need to be extra diligent with respect to your own inspections/diligence etc…Also you WILL be presented with lots of liability release docs that are well outside the scope of a normal resale transaction.
Once more this is all just my opinion. Yet I see plenty of REO with competitive commissions.
SD Realtor
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