Frequently Asked Questions
Will I get a clear title to the property?
The short answer is yes. When the bank goes through the
foreclosure process, it has to contact any person or entity which has a
lien of the property (asset). This happens in the courts and through
“tracked” mailings. The other lien holders can pay off all the senior
loan and have the right to control the mortgage amount, or let the
foreclosure continue, where as the bank eventually owns the property.
Sometimes clerical errors are made in which case this process has to
start back at a certain point. The Seller (Bank) only has control over
the title and therefore this is the item in which they have control.
They will NOT make the buyer close without Clear and Clean title, unless
buyer wants. (Something I do not suggest)
How long does it take to get an answer for an offer?
Typically, it takes 1 to 2 business days. Keep in mind,
though the Asset manager approves an offer, sometimes the offer needs to
clear approval by another level of management. During this time, the
seller generally does not entertain any other offers. Typically,
inspection timeframes do not begin until final approval is given, but
days begin before a fully executed contract is received. (Inspection
days begin upon verbal approval)
Can the buyer get inspections, and how long do they have to complete their inspections?
A general rule is 7-10 calendar days, though some backs
will allow business days. Always try to calculate the inspection days
based on calendar days to be safe. The bank is selling the asset in “As
Is” condition. They no NOTHING about the asset, but want the buyer to
know what they are buying.
Can the buyer hire a contractor to complete WDO (Wood Destroying Organism) and Appraisal required repairs?
The sellers only want authorized Licensed and Insured contactors
hired by the Listing agent to have any work completed. There are
several reasons, but this is why they are selling the asset in “As is”
condition. They do not want to do any repairs to their asset. Some
banks will let the listing agent contract for the repairs if this cost
is added to the purchase price. Some sellers will absolutely not allow
any repairs and will consider any contractor TRESPASSING. It is best to
check with listing agent on an individual basis. The best way to
overcome this hurdle is to secure a Rehab-Type loan, or expect to add
the cost of repair to the purchase price.
What type of financing is available? Do the banks offer special financing?
Most of the assets are offered for Cash or Conventional
financing. Many of these homes will be able to go FHA or VA, but the
banks do not want to guarantee the asset will pass the appraisal for
those types of financing. For the first time home buyer or owner
occupant, the FHA 203 loan is the best way to go. There are other loans
such as a conventional loan called a Rehab-Permanent loan. Both this
and the FHA 203, the buyer borrows enough to purchase the home and to
have a licensed contractor complete the repairs after closing with the
Seller. Some Bank owned properties have their own financing available
ONLY for their assets. For Owner occupants the down payment ranges from
0-3.5% and for investors as little as 10% down payment. Much better than
the 20-40% down. Of course there are also closing costs, but that is
another subject.
Do you have to get a septic inspection?
As of today, we have not had to get a septic inspection
to satisfy any closings, but highly suggest getting a septic inspection
for your own information.
Does the bank have any previous inspections?
Most to the time, the banks do not have any WDO, Septic, Home or any other inspections information, nor do they have a survey.
Will the bank pay for closing costs?
The answer is yes and no. Some banks consider all the
closing costs a buyers cost, while other consider some minimal costs
theirs. An experienced Foreclosure Agent, can help you craft an offer
to help you get the best usage of your cash.
Will the banks look at a lower offer than list?
Of course they will, they will even counter your offer if
they feel it is a realistic offer. The banks are in the business to
dispose of their assets, but they are not willing to give their
properties away, at least at this time in our area. There is nothing
wrong with negotiating, but if the perceive your offer as ridiculous, do
not expect a reasonable counter offer if any.
How long does it take to get an answer on an offer? How long does it take to close on a bank owned property?
Offers on most bank owned assets take 2-5 days and sometimes sooner.
Most loans only take 30-45 days to close, mostly depending on the
time it takes the buyer to get all the info to the lender. If there are
title issues, the closing will be delayed.
Does the bank have any previous inspections?
Most to the time, the banks do not have any WDO, Septic, Home or any other inspections information, nor do they have a survey.
If you have any questions or are interested in any of our bank owned
properties, please do not hesitate to call your Foreclosure Specialists
at “Sessa Sells”, (850) 476-6000 or
email us.