Foreclosures, Bank Owned Homes and Short Sales
Free search of Portland area short sales and bank owned homes.Bank owned properties and short sales are becoming increasingly common in the marketplace in Portland.
Bank owned properties are sometimes referred to as foreclosures or real estate owned (REO). These properties are owned by the banks for a variety of reasons, but generally it's because a borrower defaulted on a loan and as a result the property was auctioned to the highest bidder (sometimes a home becomes bank owned, because the borrower will give the lender the deed to the property in lieu of foreclosure).
In these auctions the opening bid is typically the outstanding loan balance. If there are no bidders the bank will purchase the home and put it up for sale, as a bank owned property. The condition of bank owned homes vary greatly as some banks will do nothing to the property, while others will correct any significant issues with the home and then put it on the market.
When buying a Foreclosure the purchaser is usually required to sign additional addendums issued by the bank that owns the home. These addendums typically state that the property is sold as is and the bank has little or no liability regarding the sale or condition of the property, as the home was acquired the foreclosure process. Generally it takes 1-3 days to get a response on an offer and another 3-7 days to get signed documentation once a deal has been reached.
Typically bank owned homes are sold as is, where is. The one exception to this are repairs required by the home buyer's lender. In many cases the bank that owns the home will perform these repairs if they're not outrageously expensive, because it is likely that all lenders will require these repairs to be performed as a condition to funding a loan on the home.
A foreclosed home generally sells for between 10%-40% less than similar competing properties and in some instances the bank that owns the home will offer the added incentive of special financing with interest rates below prevailing market rates.
A short sale takes place when a property owner owes more on their home than the home is currently worth and financial difficulties force the sale of the property. In this situation the sale of the home is dependent on the approval of a 3rd party "AKA" the lender/s.
Often in a short sale situation the lender is unaware that a property is listed for sale for less than the loan amount. This is not the proper procedure; ideally, a good, proactive Realtor will have contacted the lender, requested that a broker's price opinion (this is when a lender pays a real estate professional to give an estimate of value) be performed and sent in a financial hardship package. If this hasn't occurred it will take at least an additional 2 weeks for a response to an offer.
Once an offer is submitted to a lender it is then processed by the short sale or loss mitigation department. The time it takes for the lender/s to approve the sale, if they do at all, varies widely from 2 weeks to 6 months. During this period the lender can and will accept and review other offers. The buyer and seller are not in contract until the 3rd party (the lender) approves the transaction and as a result the buyer may continue to shop and present offers on other homes.
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| ©Copyright 2009 Norris Monson
All Rights Reserved. For more information contact me at
norris@portlandareahomeinfo.com. Disclaimer: While the information
contained on this site is believed to be reliable, no guaranties of
any kind are expressed or implied. The Real Estate for sale data on this website comes in part from the INTERNET DATA EXCHANGE (IDX) program of the Portland Metro Association of Realtors Regional MLS. - RMLS DEEMS INFORMATION RELIABLE BUT NOT GUARANTEED. |
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An $8000 tax credit Interest rates at historic lows Foreclosures and Short sales selling 10-40% below peak prices Makes now a great time to buy! |
