I have had this as part of my buyers package for a couple of months now, and also have copies in my briefcase for those that I meet that are in the "curious about.." stages of purchasing. Please feel free to print it out to give to your buyer clients. (You may want to edit or alter it to fit your local purchasing practices). All I ask is that you don't put it in your own websites so that there isn't duplicate content running rampant to penalize us.
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PURCHASING FORECLOSURES – TIPS AND GUIDELINES
Prior to making your offer:
Always consider an offer on a bank owned home to be your “best and last” offer as many of these homes are already bargain priced. We are seeing many multiple offer situations on these homes. You may only get one chance to bid on them – make it your best offer from the start of the process.
Bank owners and/or asset managers require full proof of funds (if a cash offer) or a pre-approval for mortgage letter with any offers submitted.
They also may require a certified or cashiers check payable to the listing office prior to reviewing an offer to purchase.
Bank sellers will want to see a closing date of no more than 30 days from the date of first offer to purchase.
If you experience a delay in your mortgage approval or other reason for delaying the closing you will probably be charged a fee for each day that the closing is postponed. The bank / asset manager may also withdraw the contract and put the home back on the market.
After your offer is submitted:
Offers on bank owned homes generally take 3-7 business days to receive a response back from the lender and/or asset manager. A signed acceptance of your offer may take an additional 3-7 business days.
Bank addendums & terms to the contract of sale must be agreed to by the purchaser and signed. (There are a few exceptions to this, for the most part their terms are inflexible.)
Home inspections
If the utilities are not on in the home they will have to be turned on in your name if you desire to have a full inspection on the home. (A full inspection is always recommended.)
Consider your offer to purchase with “As-Is” in mind. Banks/asset managers will normally not make any repairs to the homes.
Inspection contingencies are normally 5-7 days from the date of sellers acceptance. (Rarely do they allow more time.) You must be ready to proceed with a home inspection quickly in order to meet the deadline.
Closing on your home:
Closing date, time and location are set by the title company hired by the bank owners. We have very little flexibility, if any, in choosing a time that is preferable by the purchaser.
Many bank owned homes close in “escrow”. We will arrive at closing, sign all necessary documents and if the bank signed documents have arrived to the title company and funds have been exchanged, then you will receive your keys to the home.
If the bank signed documents have not arrived in time for the closing, you will receive your keys to the home and your closing documents at a later date. Most often this is within 1-3 business days of closing.
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