Buying foreclosures is a hot topic in todays market. There are many people out there trying to take
advantage of the market & rightfully so. However there are many things to consider when thinking
about buying foreclosure. I will highlight some topics here. If you want a lot of detailed information
on buying a foreclosure see a copy of my Trulia blog HERE.
There are many misconceptions about buying foreclosures. I address them below.
1.) Banks do not sell homes at a huge loss unless they have too. Typically any super great deal on
a house is taking into account the numerous repairs required on the home.
If the home is in perfect condition regardless of the amount owed it will be listed at market price.
Just as when an individual lists there home. Also, the banks are not very quick at responding to
offers and will rarely counter-offer. The typical strategy for a bank is to ask for the buyers highest
& best offer. Then whoever it is that submits the highest & best is the winner.
Sometimes they will hold out an answer for several weeks while waiting for more offers to come in.
This is a stressful situation when you are trying to buy a home. So be prepared, or start looking at
private owned homes.
2.) If a home has any equity at all the owners of the home will sell it before the foreclosure takes
place from the bank. This is just plain idiocy put out there by people trying to sell books & "secret
lists". The chance of buying a $200,000 house for $100,000 in good condition is about the same
as getting struck by lightening. Don't buy into the marketing ploy by some trying to profit off of
your ignorance.
3.) Again, the only reason you will be buying a home at 50% of the tax value would be if it needed
many repairs. This is a myth that drives me crazy when out searching at homes for buyers. They
have very high expectations set forth by some guru selling a book on midnight cable.
4.) There are lists available to purchase to find foreclosures in your area. This is true, you can pay
someone to give you a list. Or you can pick up the local newspaper and search the legal section.
This will give you the same information. All of this is public information, you can get it much easier
by buying the list, but I would recommend saving the money & using an experienced agent who is
knowledgeable in the foreclosure realm.
Now I think it is important to point out that there are some very good reasons to buy a foreclosure.
You can find some deals. Homes that just need paint & carpet can be had for very good prices in
today's market. The best rule of thumb I use for my buyers & investors is to buy the house at
80% of market value minus repairs needed. This can happen if you are patient.
Sometimes there will be a month gap from the time an offer is submitted to answered. If you are
dead set on buying quickly and getting excited about a new house, you will be quite unhappy and
stressed waiting to hear back from the bank. So this is something I stress over & over to my
buyers, I figured I should stress it to you as well.
Be patient and look for realistic deals in the foreclosure world and you will be very happy. I would
be delighted to help you in the process if you choose to go at it with an agent. Contact me if I
could help you find a bank owned property. Remember, for buyers there is no charge for my
services, EVER!
advantage of the market & rightfully so. However there are many things to consider when thinking
about buying foreclosure. I will highlight some topics here. If you want a lot of detailed information
on buying a foreclosure see a copy of my Trulia blog HERE.
There are many misconceptions about buying foreclosures. I address them below.
1.) Banks do not sell homes at a huge loss unless they have too. Typically any super great deal on
a house is taking into account the numerous repairs required on the home.
If the home is in perfect condition regardless of the amount owed it will be listed at market price.
Just as when an individual lists there home. Also, the banks are not very quick at responding to
offers and will rarely counter-offer. The typical strategy for a bank is to ask for the buyers highest
& best offer. Then whoever it is that submits the highest & best is the winner.
Sometimes they will hold out an answer for several weeks while waiting for more offers to come in.
This is a stressful situation when you are trying to buy a home. So be prepared, or start looking at
private owned homes.
2.) If a home has any equity at all the owners of the home will sell it before the foreclosure takes
place from the bank. This is just plain idiocy put out there by people trying to sell books & "secret
lists". The chance of buying a $200,000 house for $100,000 in good condition is about the same
as getting struck by lightening. Don't buy into the marketing ploy by some trying to profit off of
your ignorance.
3.) Again, the only reason you will be buying a home at 50% of the tax value would be if it needed
many repairs. This is a myth that drives me crazy when out searching at homes for buyers. They
have very high expectations set forth by some guru selling a book on midnight cable.
4.) There are lists available to purchase to find foreclosures in your area. This is true, you can pay
someone to give you a list. Or you can pick up the local newspaper and search the legal section.
This will give you the same information. All of this is public information, you can get it much easier
by buying the list, but I would recommend saving the money & using an experienced agent who is
knowledgeable in the foreclosure realm.
Now I think it is important to point out that there are some very good reasons to buy a foreclosure.
You can find some deals. Homes that just need paint & carpet can be had for very good prices in
today's market. The best rule of thumb I use for my buyers & investors is to buy the house at
80% of market value minus repairs needed. This can happen if you are patient.
Sometimes there will be a month gap from the time an offer is submitted to answered. If you are
dead set on buying quickly and getting excited about a new house, you will be quite unhappy and
stressed waiting to hear back from the bank. So this is something I stress over & over to my
buyers, I figured I should stress it to you as well.
Be patient and look for realistic deals in the foreclosure world and you will be very happy. I would
be delighted to help you in the process if you choose to go at it with an agent. Contact me if I
could help you find a bank owned property. Remember, for buyers there is no charge for my
services, EVER!
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Bryan Tobiason
Realty Executives of Kansas City
11401 Ash
Leawood, KS 66221
(913) 735-5748 Google Voice Text or Call
(913) 424-7648 Cell
(913) 529-7716 Office
(913) 642-7053 Fax
bryantobiason@realtyexecutives.com
Realty Executives of Kansas City
11401 Ash
Leawood, KS 66221
(913) 735-5748 Google Voice Text or Call
(913) 424-7648 Cell
(913) 529-7716 Office
(913) 642-7053 Fax
bryantobiason@realtyexecutives.com
KC Home Tours.com
Bryan Tobiason, Realtor®
Integrity Driving Results
Realty Executives of Kansas City
913-735-5748 -or- 913-424-7648
bryantobiason@realtyexecutives.com
Bryan Tobiason, Realtor®
Integrity Driving Results
Realty Executives of Kansas City
913-735-5748 -or- 913-424-7648
bryantobiason@realtyexecutives.com