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There's a house that we've had our eye on. It's relatively new and it's big. It's a fixer-upper certainly, but it has tremendous potential.
We were unable to buy the house because it went to Pre-Auction and the auctioning company was only accepting "Cash Only" offers. Now according to the real estate agent that's actually selling the house, we would have a chance to buy it (via 203K renovation loan).
Well, the auction was today, and the house didn't sell at auction. Where do things go from here? The starting bid was $19,000. Can I just offer up $19,000 and get the house that way?
This is new territory for my wife and I, so any advice would be HUGELY appreciated!
Would an offer for the minimum bid at the auction be an acceptable offer in most cases? Most recently, (prior to going to pre-auction status) the house was listed for $89,900. In most cases, will they take the $19,000 that nobody at the auction ever offered? Or will an offer of $19,000 be rejected out of hand?
Our Realtor has admitted to having limited experience with foreclosures that have gone anywhere near an Auction. The reason for keeping her is that she works with the selling agent -- but just indirectly enough to keep it from being against any rules apparently. So she has something of an insider advantage when it comes to this particular house.
Last edited by godofthunder9010; 08-21-2010 at 07:09 PM..
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Our Realtor has admitted to having limited experience with foreclosures that have gone anywhere near an Auction. The reason for keeping her is that she works with the selling agent -- but just indirectly enough to keep it from being against any rules apparently. So she has something of an insider advantage when it comes to this particular house.
Then she should be able to ask the selling agent what the plans are for either re listing, or putting back up for another auction. The $19K price may have just been a teaser price to draw bids (which didn't work in this case), which they may not accept. Auction sales usually have a clause that they do not have to accept a "winning" bid.
Regarding the "rules" of working with the selling agent, hopefully she has explained dual agency to you if she works for the same broker. Depending on your state, there may be variations of dual agency that affect how she can represent you, from minimal representation to full representation.
Then she should be able to ask the selling agent what the plans are for either re listing, or putting back up for another auction. The $19K price may have just been a teaser price to draw bids (which didn't work in this case), which they may not accept. Auction sales usually have a clause that they do not have to accept a "winning" bid.
I can tell you as much as you care to know about the house and it's history. Found out quite a lot as it's a relatively small town and everyone seems to know everyone's business. I'd just really like to get a feel for how low I can offer and still have a solid chance of getting the house.
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Regarding the "rules" of working with the selling agent, hopefully she has explained dual agency to you if she works for the same broker. Depending on your state, there may be variations of dual agency that affect how she can represent you, from minimal representation to full representation.
This gets a little interesting. Apparently he officially works out of another office. But the two offices work together on a lot of things. Both are 30 miles from the house in question -- and our Realtor was the lucky one who had to drive down and check up on the house periodically. But technically they don't work in the same office. The nice part is that she is in a position to know more about the goings on with the house than anyone else would be. May also be useful in avoiding the "put in an offer, heard back 11 months later" scenario common to foreclosures and short sales.
Of course if it creates any problems we'll just have to get another agent.
You stated that this is "new territory" for you and your wife. "Your" agent is also the sellers agent who has "limited experience" with foreclosures. I would recomend you find your very own "Buyers Agent" with foreclosure experience to look out for you and your interest. It doesn't cost you a thing. There are plenty of Realtors out there, why use one that is not experienced????
Not limited experience with foreclosures, just those that go to auction. I get your point Rick. We started out with a different agent, and he kinda sucked. Is there some way of being sure we find an agent who is highly experienced in this sort of thing? We've had lousy luck with it so far.
...I'd just really like to get a feel for how low I can offer and still have a solid chance of getting the house.
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That's hard to say not knowing the situation first hand - your agent is in the best position to advise you. Perhaps consider what you are comfortable with taking into account market value including condition of the home.
That's hard to say not knowing the situation first hand - your agent is in the best position to advise you. Perhaps consider what you are comfortable with taking into account market value including condition of the home.
It's a foreclosure saturated and house saturated market in this town.
The house was originally a 2 story house with the 1st story being a walk-out basement, 5 bedrooms, 3 bath, 3 car garage and about 4500 square feet, built in 2006. Sits right next to the local golf course.
Poor landscape design and waterproofing seems to have doomed the bottom floor/basement which we understand was flooded and had to be gutted down to the studs and cinderblock walls. After that you effectively had a 1 story house with an unfinished walk-out basement, 3 bedroom, 2 bathroom, 3 car garage, 2240 square feet.
When the house went into foreclosure, the prior owner took off with all the kitchen appliances and for some bizarre reason, they took all the kitchen cabinets out of the kitchen and stuck them in the garage. (We're 95% sure that all of there are there and undamaged.)
Since it's a foreclosure, the bank never bothered to put the cabinets back in, which is probably why the house never sold. Everything else on the top floor is in good condition. So we'll need to go 203K loan, replace the kitchen appliances, reinstall the cabinets, redo the landscaping to slope away from the house, seal the basement from the outside as well as the inside and patch up a few odds and ends here or there. The upper floor could easily be lived in as-is once the kitchen is put back together again. It's in rural Illinois 2 hours from downtown Chicago.
We wouldn't mind paying 80-90K for the house, but if we can get in for a lot cheaper than that then we'd obviously rather do that.
How much value do you typically lose from a house when you go all the way to auction and nobody bids? Does anyone have similar circumstance of experience?
Last edited by godofthunder9010; 08-21-2010 at 10:38 PM..
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