Want the best way to show a foreclosure home? Give the buyer a basic on how the 203k loan works. That way when they are looking at the home they could picture the potential. These loans allows them to roll in upgrades and repairs to the home. There is a streamline product that allows up to 35k for non-structural and cosmetic upgrades. The 203k Streamline requires less documentation and covers most of the foreclosures on the market today. I closed one a couple of weeks ago and it included appliances (all were missing), carpet, tile, remodel the kitchen, paint (he didn't care for the pink), fixing all the holes in the drywall, repair of the wood rot and replacing the bowed out doors. Without having the 203k available, the client would have just looked at this home and thought of home much money it was going to cost him on top of the mortgage. The majority of the banks that own the properties won't even make the necessary repairs for a FHA loan. This way, the customer isn't coming out of pocket prior to the loan closing and will have the funds to "make it is own". It puts some of the control back to the buyer when he's not waiting weeks for the selling bank to decide what they want to do about the wood rot or whatever.
I know, your thinking that they take longer and have alot more work. Not really, if you consider how long it takes you to deal with a short sale or foreclosure to start with. I work with my Realtors and get a base estimate of what the cost is to at least bring it up to FHA standards. We tell the customer that they can go and get a rough estimate while they are waiting on the selling bank to respond. From there it's just getting the vendors approved by the lending bank. I already have a list of vendors that I have gotten approved that they can choose from or find their own. Even to get a vendor approved, it wasn't a big issue. When I tell the vendors about the potential work they could get by already being approved, I've gotten their documents within days. The customer can do some of the basic work themselves if they can show that they have the time and skill available.
These are old loans and the hardest part I had was getting the Realtors to show the home as a "could be" vs of "look at all the work involved". Not everybody has a huge chunk of change to upgrade the home after buying and this is a great selling technique that has worked in our area. I love these loans and it's helped business for myself and some of my Realtors.
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