So unless you live under a rock you probably heard about the recent foreclosure nightmare. Long story short we are facing another situation where a couple of idiots and banks screwed up a system of kicking people out of their homes. If you want read more about the situation email Sarah Palin, I hear she can recommend some great media resources.
Anyway what does this mess mean for our immediate area? Basically a painful process just got more painful! When dealing with foreclosures the first thing you need to realize is that the buyer has no control. The seller (bank) drives this transaction and if you are not willing to play by their rules then start looking at traditional home sales.
The sale of foreclosures has not been completely halted but several banks have begun to review properties they foreclosed on to make sure they are in compliance. This is great because the banks are finally doing their job but its bad for the buyer. In a lot of instances it means the buyer might not find out until a day or two before closing that there is a problem. There is a light at the end of the tunnel though. In most of these instances the property is not closing on its scheduled settlement day but typically these properties are closing a week or two later. It is in everyone’s best interest to make sure the closing ultimately happens.
There are a lot of entities that are impacted by this mess. To name a few:
Agents – There are a small number of agents that strictly handle the sale of foreclosures. Just like buyers agents they do not get paid until the property settles.
Title Companies – There are a lot of title companies where their main source of income is derived from foreclosures. In a lost if instances certain title companies might have a relationship with a particular lender IE Bank of America. If BOA puts a complete halt on foreclosures business at certain title companies might dip by 50-100%.
The Foreclosing Lender – Yes thats right! They hurt too. The longer the property sits vacant, the longer they are out funds whether it be from utilities or taxes.
Foreclosures are not a losing proposition. They just need to be treated like a marathon and not a sprint. If you have some extra time on your hands then these are still the ideal property for you.