Can You Buy Foreclosures at What the Bank Pays For Them?

By
Real Estate Agent with RemaxPV Realty
If you watch foreclosures, as I do, you notice that banks always submit the opening bid right before it forecloses on a property. Now a buyer could attend the Trustee Sale(Auction) and overbid the bank's opening bid and win the home. You see that happening in about 3% of all forclosures for just a penny more than the opening bid. However, there is no guarranty that the title is clear, and it probably is not. Therefore, the gamble may be too great to bid at a Trustee Sale. But wait! Suppose I can track that foreclosed property through the entire foreclosure process and that I have a client already prequalified, who wants that property after it forecloses for him/herself or investment. Could I now offer the winner( the bank) a great deal before it turns the property over to an REO Agency: 1. The opening bid price(assuming its a good deal, see item 3) 2. An escrow to close in 30 days 3. No costs to the bank, as my client pays all closing costs + commissions 4. A 10 day inspection period to view and inspect the property. Is this not a win-win situation for the bank and my client? I can do it!

Comments (3)

Dave Edwards
Dave Edwards Realty - Greenville, SC

That does sound like a great way to do it. Thanks for sharing.

Oct 07, 2008 11:19 AM
Pamela Elder
Gaines Realty - Inman, SC

I understand what you are trying to do, just how many homes have you sold doing it this way? The way you describe it sounds to good to be true. If it truly works for you keep it up.. However there is something that is bothering me and I can't seem to put my finger on it. Oh well.. When I remember I'll be back..

 

 

Oct 07, 2008 11:35 AM
Allan Ephraim
RemaxPV Realty - Rancho Palos Verdes, CA

I have just started to approach the foreclosures this way. I believe that the offers to the bank will be less than the opening bid , as unless the property is in a destressed area, the open bid is close to market value. I am hoping that no cost to the bank, especially no REO costs, will drive my offer. If you think of any negatives, let me know! Thanks.

Oct 07, 2008 11:51 AM