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I am in the middle of the purchasing process of an REO. House has been vacant for two years, on the MLS for 250 days, original list was 260k. Kept going down by 10k every month or so, dropped 50k, and last listing price was at 169k. I'm getting it for 147500.
1. They accepted my offer and I have signed all their addendums. They received these on June 25. I am still waiting to get a copy back with the bank's signature. I keep reading that REO's can take a long time to get back w/ answers on offers, but does it take this long normally when the offer has already been agreed upon?
2. Throughout the addendums it makes clear references to "as-is". I'm getting mixed answers from articles, friends, etc. about whether or not to negotiate any repairs once the inspection goes through. There is some water damage in an add-on room that once was a garage. There are also appliances missing. The listing also states there is a utility shed on the property, when there is not. I was planning on negotiating all of these things, do I run the risk of the bank saying forget about it? I thought pretty much everything is negotiable, but I don't want to be naive.
This is my first post, but lay it on me.....anyone with any advice is greatly appreciated.
I really can't offer you any advice but there are alot of good people here that can help you.......We actually looked at a REO home for sale & after reading up on them we decided NOT to make a offer on the place. I heard some mortage lenders will go in and make shady repairs on the house ...Everything with the house we looked at seem to be Ok except for the painting of the outside of the home, It had mildew bleeding thru the sloppy paint job.
From my understanding REO are homes that went to auction & failed to meet the min bid & can be costly when it comes to the repairs. You need to have alot of money put aside just in case..... because the bank will NOT lend you the money to fix the home no matter how much money you saved on the home. Every REO Home that I've seen listed are listed As Is.
I am in the middle of the purchasing process of an REO. House has been vacant for two years, on the MLS for 250 days, original list was 260k. Kept going down by 10k every month or so, dropped 50k, and last listing price was at 169k. I'm getting it for 147500.
1. They accepted my offer and I have signed all their addendums. They received these on June 25. I am still waiting to get a copy back with the bank's signature. I keep reading that REO's can take a long time to get back w/ answers on offers, but does it take this long normally when the offer has already been agreed upon?
2. Throughout the addendums it makes clear references to "as-is". I'm getting mixed answers from articles, friends, etc. about whether or not to negotiate any repairs once the inspection goes through. There is some water damage in an add-on room that once was a garage. There are also appliances missing. The listing also states there is a utility shed on the property, when there is not. I was planning on negotiating all of these things, do I run the risk of the bank saying forget about it? I thought pretty much everything is negotiable, but I don't want to be naive.
This is my first post, but lay it on me.....anyone with any advice is greatly appreciated.
Cindy
Shouldn't take too long. I would have your agent follow up with the bank. There might be something unforeseen that's affecting their timely response.
My agent made it clear to me that you can ask for things, but if it says "AS-IS", you're not likely to get anything from the bank. Their addendum may also have a paragraph that says essentially that the bank is not responsible for city code violations or things disclosed in print that subsequently end up not being there (utility shed, for example).
Thank you both for your quick response. I checked the addendum, and it didn't state anything about not putting anything back in the house that was listed on the MLS.....my agent says *supposedly* they are required by law to have a shed on the property or take money off to compensate for the shed.
I know it's only been a week and a half, but it seems like forever! This is my first house and I honestly don't know how some people do it. I have the luxury of having a nice landlord where I am on a month to month lease, so no worries....but after seeing how the home purchase process is so involved, it's a wonder how people buy homes while trying to sell the one they are living in!!!
I'm just going to keep playing the lottery and hope I won't end up in that situation......lol.....
From my understanding REO are homes that went to auction & failed to meet the min bid & can be costly when it comes to the repairs. You need to have alot of money put aside just in case..... because the bank will NOT lend you the money to fix the home no matter how much money you saved on the home. Every REO Home that I've seen listed are listed As Is.[/quote]
Yeah, I've seen a lot of that around here in Orlando as well. I am fortunate enough to know the neighbor of the future house and she was able to give me some back story about the house....contractor fixed it up and flipped it while the market was hot.....everything looks ok, but of course, I'm sure the inspector will find SOMETHING.....
Is that the main reason you decided not to go w/ REO's, because of the repair stuff? Or is there other stuff I should look out for?
When I saw the mold/mildew bleeding thru the new paint it lead me to believe they did the cheapest thing they could of done ....paint over the problem. Since the home was being sold AS IS ...I didn't think the lender would negotiate if our inspector found problems. So we asked our Loan Officer if we choose to go with a REO and our inspector say there are major repairs that needs to be done.... Can we roll the repairs into our loan if we need too? She told us, No. We do have money put aside but I did not want to take the risk & be out money on the home we just bought
We are first time home buyers here also... I'm about to go crazy trying to find a home that meet our needs...It's so stressing It got to point where I had to take a step back & say No ...this is not what we wanted.. I found myself trying to settle on a home...I know when we make a offer on a home the stress will start all over again!!! I would love to move into a home where I knew one of the neighbors so they could tell me the scoop on the house.Good Luck!
Location: Mokelumne Hill, CA & El Pescadero, BCS MX.
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The reason you're getting such a good deal from the bank is that the property is being sold as-is. Banks aren't in the business of producing a totally habitable property, they're in the business of getting these home off their books.
The worst they can say is no, but you should expect that answer from them.
I am in the same boat as some of you. Made an offer on a bank owned home and started the waiting process. It is extremely stressful.
The property I am looking at is listed as-is. But that just means the bank does not want to fix anything or give you money to fix it. It does not mean they won't lower the price though
I had my inspection and am trying just that. Of course every time we go back with a counter its another two weeks lost I have read it can take weeks, even months, with banks.
I went FHA so I have all kinds of other headaches to worry about.
For us it took two weeks from verbal agreement to receive a signed contract from the bank; I know this process is hellish... hang in there.
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