The auction is to be done by Real Estate Disposition which has that all to familiar television infomercial. After reports surfaced that they bought the domain Auction.com for a cool $2.5 million (note that I have no idea what was paid for, just a rumor from a few months back), it doesn’t’ look like this will be the last stop.
Anyways, it appears from the website that at this point… 159 homes are set to auction off at the Minneapolis Marriot City Center.
Some homes have opening bids as low as $500. Just make sure you understand what you might be getting into.
All these homes have public open houses or get in early before the rush.
Open House Dates & Times
September 5th 11am-4pm
September 12th 11am-4pm
September 13th 11am-4pm
If you are interested in checking out some of these properties, let me know… it’s always good to have some sort of representation on your side when dealing with these things.
]]>The map is interactive, zoom in or out… move around the Twin Cities!
]]>From CNN
In second place was Minneapolis, where the filing rate grew by 58.6% to 1 in 90 homes
Overall, Minneapolis comes in at 66 out of 209 of the largest metro areas on RealtyTrac’s list and has a foreclosure filing rate of 1.11%. That’s below the national average of 1.19% and far below Las Vegas of 7.45% which by the way is leading
Takeaway (not mentioned) locally is foreclosures and lender mediated sales have fallen in market share compared to earlier in the year but have jolted a 103% increase since last year. Given the recent uptick over the past few months, buyers have absorbed a good amount of supply.
Get the fresh Foreclosures and Short Sale Twin Cities Housing Market report for Q2. [Adobe Reader needed]
What say you?
]]>
Never mind the lower part of the question because I have no idea what he is getting at. Basically I had nothing better to talk about so I found this Q somewhere else 
Lets take a look at the question, would a bank swap property? Last time I checked they had tons of inventory that they are trying to get rid off and more waiting in the wings because defaults aren’t slowing down anytime soon.
It’s definitely not as easy as it seems for a bank to own property nor are they in the business to hold onto property. They want to get rid of it. Doesn’t hurt to try but good luck figuring out who to contact at the lender 
That’s it for now
Buying a foreclosure in an area that is populated with bank owned property is a surefire signal that prices could be held down for years to come. Just because it appears to be a steal at the price, doesn’t mean it is a good buy. You can tell a lot by the neighborhood surroundings.
Don’t forget that there is still shadow inventory waiting and which hopefully won’t flood the market with more inventory.
Even though banks seem to pricing properties to induce multiple offers, there are still bank owned homes around the Twin Cities that are way over priced. Get a thorough understanding of what is happening with home prices in the subject location. Have you agent (like me ) do a complete market analysis, not one of these quick thi
Another common mistake overlooked is under estimating the cost of repairs. A good chunk of foreclosed property in the metro require a deep pocket book. Before you write the offer, get a solid idea of what needs priority repairs. Some stuff might be able to wait until you get settled in. But you might want to make sure appliances are in proper working condition along with other major mechanicals. Get some bids as well, it doesn’t hurt.
Any other commonly overlooked mistakes that need to be added?
]]>According to their survey, younger buyers are more likely to purchase a foreclosed property than a senior. I could probably contribute that to the willingness of younger buyers to actually take on more work in rehabbing a house. To much risk for older buyers in the market place.
CEO Pete Flint form Trulia had this to say from CNBC
“First time home buyers have been priced out of the market for the last few years, and they’re now jumping in in significant numbers since prices have come down,” says Trulia.com CEO Pete Flint. “So first time home buyers who are trying to step on the first rung of the housing ladder are buying foreclosures in significant numbers.”
As far as the the Twin Cities real estate market goes, home sales going the way of the lender mediated type (short sales & REO) are less than a few months ago. At least around Minneapolis/St. Paul area they are, cities that were hit hard by foreclosures are sort of in another boom when it comes to people snapping up bank owned homes.
The Minneapolis Association of Realtors puts together a great report on tradional home sales vs lender mediated sales, if you like data… then this is where to sink your teeth in.
After showing a bit of property lately, I’ve been finding out that actually quite a few home buyers don’t want to put up with some of nuances when buying a foreclosed home. I’m seeing more and more buyers just want to buy a home that doesn’t require a tetnis shot when you first set foot in the door. So I just might have to disagree with more buyers are going after foreclosures and possibly playing it safe with the traditional.
What about you, if you could get a ‘killer’ deal on a foreclosure…would you go for it?
]]>Not sure why but the past few posts (see mortgage foreclosure bailout) have included video from recent Plenty of local trades being left behind in the wake of luxury foreclosures along Lake Minnetonka.
]]>From the article
But real-estate brokers say multiple offers on certain homes have recently become more common in parts of California and Arizona and the Washington, D.C., and Minneapolis-St. Paul metropolitan areas.
Already being reflected in home sales increasing, banks of distressed properties are already discounting homes that are starting to see bidding wars and multiple offers as soon as the property hits the market.
I did over hear someone that went $40,000 over list price here in the Twin Cities market. Not sure why, would have been interesting to see the other offers but nonetheless it is happening. Also heard an agent writing 11 offers with one client and still have yet to have accepted purchase agreement.
Not to mimic that annoying NAR commercial with “Now is the Right Time to Buy”, if you are in the market for real estate… some properties in the Twin Cities are going fast. Of course, now may not be the “right” time for everybody.
]]>First, check this out on the lifecyle of a foreclosure in Minnesota to get a better understanding of what is happening.
There are plenty of options on how to buy distressed properties (pre-foreclosures, short sales, auctions, REO), the easiest way with the least headache is once the bank has complete possession of the asset.
Searching for REO Properties
Some sites allow buyers to search for bank owned homes given the IDX search solution like I have on this site. You can also check out Minnesota REO Buyers which is site solely dedicated to searching for homes that are Real Estate Owned.
Kick off your Minnesota Bank Owned Home Search here
The REO Tour and Offer
Get your work shoes and your off, looking at REO property can sometimes be an adventure. Each house can be different with its conditions. Here is where Caveat Emptor comes into play. Make sure that you are closely evaluating each properties because the bank will not be paying for any repairs, there are no seller disclosures and the bank will be selling the property “As Is”.
When it comes to making an offer on the property make sure that you have everything in order. You are going to want to have your pre-approval letter from your lender along with proof of funds (some banks, but not all) and an earnest money check. Banks usually set their own rules on things like that so it is important that your REO Agent reads the disclosures on how to prepare the offer. In most cases, banks have their own contracts that supercede Minnesota Purchase Agreements or go along with them.
Some things to be aware of as far as financing your bank owned home. Most banks prefer conventional loans or cash, not all do but it varies by each institution and condition of the property. In order to have FHA to provide the loan on a property, the property has to be habitable. To save trouble down the road, make sure that you have the right financing in place to save time and future headache. You might also want to check out FHA 203K streamline loan, a unique loan product for distressed properties.
Also, consider yourself lucky if the property still has all the appliances after closing. Banks cannot convey personal property at closing so give yourself a high five if they are there when you first move in. Banks make no guarantees.
Banks will also provide you with a “clear” title, meaning free of liens and clouded past. It is in their best interests because no lender will fund a loan that has defects on title.
As far as writing the offer on a REO property, banks are looking for the easiest path. They typically like to close within 30 days. Don’t throw out the super lowball offer, even if they are competitivly priced, banks do their due diligence in pricing the property accordingly.
Banks will also pay for closing costs if need be. Be careful in a multiple offer situation, this will bring their net proceeds down so you might need to offer more to be more competitive.
Some properties that are bank owned are starting to get multiple offers. When involved make sure your offer is clean and be prepared for bidding wars.
Banks and Addendums
This is the addendum where you agree to purchase the property “As Is”. The bank doesn’t warrant anything that has happened to the property and beats that into the buyers head. Banks will do anything and everything to make sure the contractual language in the agreement favors them. They try to push closings up to an earlier date and charge “per diem fees” of $100-$200 a day if the property does not close by a certain date.
They will also try and manipulate contingency periods such as inspections and financing to certain dates. Banks are sneaky, make sure you and your REO agent know these dates!
Make sure to get an inspection! Nuff said.
Also quick note on inspections with bank owned property: if the property has been winterized (utilites turned off, water, etc) and the buyer wants them on for an inspection, expect to pay for the property to be de-winterized at a cost of $100-250… roughly.
What next
Expect to wait a little bit from the time you submit your offer, unfortunately banks work on their time. However most banks can get back to you in a reasonable time frame within 48-72 hours, but their are horror stories of waiting months. It’s the roll of the dice.
Hopefully the REO listing agent provides some sort of updates, they are not known for being customer service friendly.
If the offer is accepted you are good to go with moving on with financing and inspections. If not, then they want to dance with the negotiations.
Next comes the closing and banks like to have you use their title companies. I know, talk about a RESPA violation but you will get over it. Some will let you choose but they have certain title companies they use all the time that they claim make the process easier. I don’t buy it, but noting you can do about it.
In the end…
Is there are deals to be made if you find the right property. The transaction is not hard if everybody is on the same page. I would love to hear of anything else to be covered concerning buying REO property, let’s talk it out below.
]]>These homes that are on the map in Burnsville are lender mediated and therefore need bank approval.
If you are interested in a showing or viewing of the properties, then contact me here and we can talk it through.
Hint zoom in on a specific area to pull up more properties.
]]>