I am not kidding you, I have 11 active buyers, approved and looking. I did say looking, right? I am finding that the latest challenge for me in selling real estate is so many buyers are trying to "steal the deal".
I am all for finding a great deal for my clients. As as matter-of-fact, I am always trying to find a home that has value to it already, or has great potential to be a viable property for future sale.
The thing is this. Our area is primarily VA Loan buyers. If you are not familiar with the VA Loan they VA approved appraisers are stricter than, let's say, a Conventional loan. That being said, it is not that easy to find a home that will get all the way through the buying process and complete the appraisal without some items that must be corrected prior to the loan be approved.
Herein lies the problem. "I want a foreclosed home". " I want a bargain". "I dont' mind fixing it up". Okay so you want a fixer upper. Well guess what, that is not a home that is eligible for most VA loans.
So my new process is this. Usually I have to spend a few days showing properties and explaining why this particular home will probably not get through the loan process. We might be able to ask for repairs, but chances are, ask all you want, nothing will get done by the REO.
Now my VA buyers are back to reality and looking at homes in their price range that are not foreclosed. Guess what? These houses are too small, not new enough, etc.
I am having to readdress how I work with these buyers. When I get a (mostly) young couple wanting a deal by purchasing a foreclosure I bring them into the office and walk through the entire "normal" buying process. They I show them a "typical" Foreclosure process with all the conditions, etc. I make sure they are 100% clear on the challenges, and extra expense that they can incur with the acquisition of an REO. Now about 50% of my buyers are thinking twice about this. They are allowing me make recommendations about which homes might be in the condition they need to be to finish the process.
This is dramatically cutting down on "wasted showings". Not that I mind checking out houses that are available, but I am surely tired of a home that is 2,000 square feet with a 30 year old HVAC system, the roof is leaking, the paint is peeling and the carpet is torn or ripped off the floor.
I welcome your ideas for helping these buyers navigate this treterous area of foreclosed homes.