Foreclosures
Unraveling the Myths
“Foreclosure” is a word that those keeping track of the market and economy, as well as us Brokers, Agents and Loan Officers have become accustomed to. “Foreclosure” means a lot of different things depending on what viewpoint you’re looking from. But one thing’s for sure: Over the past few years propaganda spread myths and rumors about foreclosures and various misconceptions have come and gone. Below are five foreclosure myths and the counter explanations, from Trulia “5 Foreclosure Myths for 2012” by Carl Medford. I for one hope that #1 “myth” does in fact carry through and become “fact”…. but we shall see!
1: There is going to be a flood of new foreclosures in the market – The way Medford views our current foreclosure situation is that banks have 
learned they can control local prices by how many foreclosures they release to the market. So why would they release a cornucopia of foreclosures to lower the prices on the homes? They’ll keep trickling the foreclosures in to try and get the best offers for their homes.
2: You can go directly to a bank to buy a foreclosure - Despite this popular belief banks have a system to how they handle selling their homes. First they offer their properties on the courthouse steps. So if you want an REO, pay cash at the courthouse steps because from here they hire local agents who put the foreclosures on the market and on MLS.
3: You can get a killer deal by submitting lowball offers on foreclosures – This is a myth that’s been hanging around far too long. Truth: Banks 
want REO’s sold in a month or less so the properties are typically priced under comparable properties. If the home doesn’t sell fast the bank will then lower the price. Because of this lowball offers are ignored and shouldn’t be bothered with.
4: You can’t use foreclosures or short sales when doing an appraisal – This is no longer true. Many neighborhoods are made up of foreclosures and short sales therefore those homes represent the actual value and HAVE to be used to appraise other properties. This is now the system for how homes are valued.
5: Foreclosures are only affecting the bottom end of the market – While this used to be true, times have changed. While foreclosure rates have decreased on the lower end of the market they’re increasing on the upper end of the market. The homes up in the $1million and $2million range have skyrocketed.
For this whole article click this link.
I hope this has helped to clear the water, when looking at the current foreclosure situation. If you want to take advantage of the foreclosures out/coming out on the market yet do not qualify for conventional financing then that’s where I can be of help. “The Guy in the White Hat” has come to the rescue for many Buyers wanting to get into a new home… and your credit doesn’t have to be perfect nor does the home you want to buy and fix up how you want it!
Lynn Tardibuono – Flipper Chick- Real Estate Agent and Co-Owner of Sun Pacific Mortgage and Real Estate. Serving Sonoma County since 1988. Her number is (707)523-2099 and you can also visit the website at http://www.sunpacmortgage.com
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