They Aren’t Usually the Bargain Buyers Expect
Banks in Pompano Beach do not give properties away, despite the commercials you might see about “amazing deals for homes under &50k!” Most banks will price a foreclosure near true appraised value unless it’s really a problem property for reasons buyers will not want it anyway.
With foreclosures pricing at little or no discount to market value, sellers can make their properties very enticing by having them “move-in ready” and at little or no premium to those problem-ridden bank owned properties.
It Can Take a Long Time to Close on a Foreclosure
You would think that banks would be in a hurry to get a poorly performing asset off their books, but it’s rarely the case. They can take weeks instead of days to respond to offers and counteroffers. Getting answers to questions can take forever.
Smart sellers will know that their home is going to fare well in competition because buyers will be able to close and move in on a realistic time schedule.
Disclosure of Defects is Non-existent with Foreclosures
Banks will disclose nothing about the condition of the foreclosure home, as they would likely have no knowledge of problems anyway. Most state laws exempt them from disclosure responsibility.
Sellers will fare well in competition with full disclosure, plus correction of what can be fixed prior to listing. Buyers will be comparing an unknown quantity with a full disclosure and condition report.
The Repairs on a Foreclosure can be a Scary Proposition
First, the bank will not want to do any pre-closing repairs, offering the property “as is.” The buyers will do an inspection, and it is likely that the list of repairs will be quite extensive. The buyer’s lender will likely want some or all of the problems corrected before closing, leaving the buyer in a dilemma, and they’ll usually walk away.
The smart seller will have done their own pre-listing inspection and corrective action repairs. They will be offering the alternative of a move-in ready home, with proof of all repairs they’ve done to bring it to that condition.
Real Estate Professionals Need to Educate Their Sellers
As a real estate professional consulted about listing a home, you should be educating your sellers in these facts. They may be approaching the market with fear of the need to price discount to compete with foreclosures. Let them know these facts. Show them the advantages they enjoy over the bank foreclosure properties. Help them to make appropriate improvements and repairs in order to go to market with all of their competitive advantages in place. You and your sellers will be glad you did.
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