Are Boca Raton Foreclosures A Good Deal
Posted by on Friday, May 8th, 2009 at 2:36am.Are Boca Raton Foreclosures Really Good Bargains?
The presumption that a majority of Boca Raton real estate home buyers have today is that foreclosures are really good bargains. In fact many buyers are only looking to buy a foreclosure or short sale property because they want a bargain. Here are the facts. You be the judge as to whether foreclosures are really good bargains.
Pros
Foreclosures are generally offered at discounted prices because the banks want to get rid of the inventory on their books and are not in the business of maintaining property.
Some properties have been discounted as much as 30%- 50%. As a result of so many foreclosures and short sales on the market, non-foreclosure properties have been discounted as well.
Because the bank now owns the property, the title has been cleared and you are able to get title insurance opposed to purchasing a home at a foreclosure sale.
If you are buying a Fannie Mae owned properties, Fannie Mae will pay some of your title and closing costs if you negotiate that in your purchase contract.
Cons
Some REO (bank owned properties) have been stripped by their former angry homeowners. You will find homes that have no appliances, missing cupboards, missing kitchen counters, and no toilets or light fixtures.
Homes need repairs, are major fixers or teardowns. However, if you are willing to make the repairs, you may be getting a great deal on a property in a terrific area.
Since no seller’s disclosure is required, you do not know the history of the home. It is important to have a home inspection done. Properties are sold in an “as is” condition.
There is a misconception that the banks are giving away the properties. The truth is that a number of bank owned properties are selling close to the bank’s asking price because the prices have already been discounted 30% to 50% at the time they are listed. Buyers who are making very low offers may not get a response from the bank.
What to Look For
A home that is in move in condition and does not need major repairs unless you can do them yourself or are getting the home at a price way below market value.
Home that is priced at market or slightly under.
Do your due diligence. Have a home inspection.
Use a local Boca Raton Realtor to represent you. Someone who is knowledgeable about the area prices and that can help you find the right property and assist you with your negotiations.
If you are buying a condo that is a foreclosure unit or even if it is not, ask how many units in the condo building are in default or in foreclosure, because even if the property is a great deal you may not be able to get financing because the building may not meet the new Fannie Mae lending guidelines for Florida condos.
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