There are some good foreclosure homes for sale in the Inland Empire.  If you are considering purchasing a foreclosure home (also known as REO’s or bank-owned), here is some information that is important to know before you start looking. 

• Often, foreclosure homes will sell at or over the asking price. If the bank lists a property well under market value, there will be a flood of buyers and multiple offers.  Sometimes banks will list a home priced below true market value as an aggressive marketing strategy to attract multiple offers and this strategy works. When multiple offers occur on a property, the bank will usually request that all buyers with offers on the property bring in their “HIGHEST and BEST” offer and the bank accepts the best offer. 
• Banks accept offers close to asking price within the first 30 days on the market, NOT 40 or 50% of their asking price. The most common misconception is that banks are desperate and will take anything. This is not true.  Banks want to get close to market value for their properties.
• The bank will look at the how you will be paying for the property. They look at the type of loan you will be using: Conventional, FHA or VA, or cash - and the amount of the down payment.  Conventional mortgages can usually close sooner and have the least amount of contingencies. Some houses will not work with FHA financing because there is too much work needed to be done on the house.
• Banks will look for a large Earnest Money Deposit which signals that a buyer is very serious about the property.
• Banks will usually respond to offers within 2 days to 2 weeks. Usually the better your offer is the faster they respond. They aren’t in much of a hurry to respond to low ball offers and it is possible a buyer with a low offer won’t get any response.
• Bank-owned (foreclosure) homes are sold in AS IS condition. Banks will not provide any repairs or credits for repairs.
• There are NO seller disclosures provided with a bank-owned home.  The bank has no information on the condition of the home or previous repairs/problems.
• Once the bank accepts an offer, they want the buyer to be able to close within 30 days. 
• Buyers will need a loan PRE-APPROVAL before submitting an offer.  The pre-approval letter needs to be submitted with the offer.  Banks will not even look at offers without a current pre-approval from a reputable lender.  Buyers do not have to use their lenders, but some banks require buyers submitting offers to be pre-approved by their own lender of choice to be considered.
• Be patient.  There is a lot of competition for the best foreclosure houses.  You probably will have to put in several offers before you get an offer accepted.  

Note:  Currently there are fewer foreclosure homes in Riverside and Corona than there are short sales.  My website.

Written and posted by: Vicki Pedersen, ABR, ASP, Pedersen Real Estate, DRE # 01435175  Riverside/Corona, California, 951-840-5212  vicki@pedersen-team.com     Visit my website.