Walnut Creek Area Short Sales and Foreclosures
There are some great real estate deals to be had in Short Sales and Foreclosures in the Walnut Creek area but there are also many pitfalls you need to be aware of. Possibly the most important thing is to make sure you have a real estate agent to represent you who has real-world experience of working with buyers of such distressed properties and who will guide you through this minefield.
Short Sales (Click Here If You Are Only Interested In Foreclosures)
The problem:
Due to the recent decline in home values across the country, many people have found themselves with little or no equity in their homes, particularly those who bought in 2003 or 2004 with little or no money down.
A significant number of these homeowners bought their homes not only with no money down, but with initial interest rates set at artificially low levels - so called "teaser" rates. This was the only way that many of these people could meet the monthly mortgage payments.
These "teaser" rates are only temporary of course. After two or three years (and sometimes five or seven years), they get re-set to the current interest rate. These loans were set up with the assumption that house values would just keep increasing so that when the time came for the mortgage rate to re-set, the homeowner would have gained so much equity in the home, they could re-finance, perhaps again with a "teaser" rate. But homes started to decline in value rather than increase so many people found them in a situation they could not recover from.
In reality, the above scenario has only affected a relatively small percentage of homes, but the numbers are high enough to have a significant impact on the real estate market.
The Short Sale Solution:
When a homeowner discovers that they have no hope of affording their monthly mortgage payment, they should contact their lender with the aim of getting a "Loan Modification", but since this is rarely successful, the next best solution is often a "Short Sale". What this means is that the homeowner sells the home and after payment of all closing costs, the net amount remaining is insufficient to pay back the loan. In a Short Sale, the lender forgives that shortfall. The benefit to the homeowner is that they get to walk away from the home with no further financial obligation to the lender. Their credit rating will certainly suffer and they will not be able to qualify for another home loan for 2 years or more but this has much less impact than Foreclosure and is a less stressful process. With a Foreclosure on your record, you can expect to have to wait at least 5 and often 7 years before being able to get another home loan.
Short Sales can be a good way for a buyer to obtain a home at a discounted price but there are many potential pitfalls and you must be represented by an agent who understands the process. The offer has to be structured in such a way that there is a high probability of the lender accepting the terms as well as a purchase price that is close to the one offered. You will also need a considerable amount of patience, as without exception, lenders do not share the same sense of urgency as you.
I have had considerable experience in working with buyers and sellers of Short Sales. If you think that this kind of transaction could be of interest to you, let me know and I will meet with you and provide you with a lot of relevant information.
Please note that you will need to be pre-approved for financing before you can submit an offer for a home being sold as a Short Sale. I can introduce you to a lender who can help you with this.
There is a lot more to know about all of these situations than is detailed above. I do have the answers you need and I can represent you in the purchase of such homes. Just send me an email or call me on my cell-phone at (925) 997-1585 and I will arrange to meet with you and I will explain the process in detail and show you how to move forward.
Bank Owned Foreclosures (REOs)
Bargain Priced Homes Are Available Throughout Contra Costa & Alameda County With As Little As 3.5% Down Payment
As a result of the dramatic downturn in the real estate market, much of which as a result of sub-prime lending practices and adjustable rate mortgages re-setting, many homeowners have found themselves unable to meet their monthly loan payments. As a result, after a protracted procedure, unless the homeowner manages to dispose of the home by means of a "Short Sale", the lender forecloses on the home and takes over possession. The lender then takes title to the home and sells it as a REO (which stands for "Real Estate Owned") property.
How Bank Owned Properties Are Sold
Having re-possessed the home, sometimes the bank will have it brought back to an "acceptable" condition where necessary, with maybe some paint or carpet, certainly little more - and they will then list it for sale. Sometimes they do nothing more than clear out anything left behind before listing it for sale. In any event, the bank's main objective is to sell the home as quickly as they can and recover as much of their investment as possible in the process. They do not want homes to sit on the market for long and these homes are some of the best buys in real estate today.
But constructing and presenting an offer on a bank owned home requires a different approach to that used when writing an offer on a home listed for sale by a traditional seller. You need to remember that banks have no emotional attachment to the home and they don't care who buys it. It is all about the bottom line!
You also need to know that the actual process of buying sch a home, after your offer has been accepted, is very different to a normal transaction. Most of the banks do not abide by the generally accepted standards of practice that we use in California and unless you are working with an agent experienced in REO purchases, you can find yourself facing significant problems.
I have access to all of the Bank Owned / REOs on the market in Contra Costa and Alameda County and I am experienced in representing buyers in REO purchases. If you want to buy such a property, I can help you find one. Just send me an email or call me on my cell-phone at (925) 997-1585 and I will arrange to meet with you and I will explain the process in detail and show you how to move forward.
Please note that you will need to be pre-approved for financing before you can submit an offer for either a home being sold as a Short Sale or a Bank Owned Home. I can introduce you to a lender who can help you with this.
If you have any questions or comments, please feel free to call me on (925) 997-1585 or email me at bernard@bernardgibbons.com.