When considering putting an offer on a Tampa bank owned home you may run into these statements by REO listing agents “this is a bank owned property and bank is exempt from filling out property disclosures” While there is no law that a sellers property disclosure needs to be filled out. If the bank(seller) or real estate agent know of any defects that may affect the value of the property these facts need to be disclosed period. I have said this time and time before you even see these statements on non occupied owned homes as well; just because a seller has never lived in the property does not mean they have no knowledge of the condition of the property. It seems ridiculous to me that anyone who owns a home including bank owned homes have no knowledge of the condition of the property. These are just ways sellers or listing agents trying to circumvent property disclosures and it opens them up to lawsuits down the road.
Here is another thing to consider how many bank owned homes come back on the market due to inspection issues? Now the listing agent is aware of defects that were just reported to them. Is that agent now still saying the owner has no knowledge of the condition of the property?
So work with your buyer’s agent to make sure the REO listing agent is disclosing material facts about the property and you have in writing there is no knowledge of latent defects. There are many lawsuits now popping up with bank owned properties and lack of disclosure. You still of course want to have a professional home inspection before purchasing any home.
Here is a great article on Active Rain about REO listings and disclosures
Starting this week I am going to be featuring a Tampa foreclosure for sale on each and every Friday. I am going choose a foreclosure I believe to be a great value and should not last long on the market. I will monitor it each week to check the status and report when it goes pending. These will not be any of my own listings. I of course will be able to represent you as a buyers agent if you are interested in the home and are not currently working with a Tampa Realtor.
There are currently 471 single family foreclosures for sale in Hillsborough county as of September 2010.
Here is the first Foreclosure Friday. Single Family located in the community of Live Oak Preserve in New Tampa. It is a 3 bedroom 2 bath with 1575 SF.Huge great room with laminate flooring. Kitchen has granite counters. Click below for more pictures and information
When purchasing a foreclosure home in Tampa some things to consider would be.
- Most foreclosure homes also known as bank owned homes are already reasonably priced, if you look at the days on market most foreclosures in Tampa are under contract within thirty days.
- Banks are just like a typical owner in the sense they want to get fair market value but they are not going to be greedy and will price the home according to the current market conditions and sometimes under market value. Most bank owned homes will not pay more than 3% sellers concession towards buyers closing costs. So if you have to have more than 3% of your closing cost’s paid then purchasing a foreclosure home may not be the best route however soon FHA will only allow 3% in seller concession anyhow.
- Banks already take into consideration the condition of the home so if the home needs some TLC the bank is going to reflect that in the price. The home will be sold as is with right to inspect which means they are not going to warrant any repairs but you have the right to walk away if not satisfied with the home inspection. If you are purchasing a home under $150,000 the amount you can negotiate lessens for a couple reasons; one being what I mention above in regards to the bank pricing the home to sell from the get go. The other being there are more buyers who qualify to purchase at this price point so you have more competition and may run into multiple offer situations.
- If a foreclosure has been sitting longer than thirty days it usual means it is overpriced, these homes may have more room for negotiating. However foreclosures usually will have automatic price reductions if no offers have been presented within thirty days.
- Like purchasing any home make sure you work with a Tampa Realtor who knows the market and provide you comparables and facts to support the current market value, with the conservative ways of appraisers in today’s market it is highly unlikely you will overpay for a home, of course there is no predicting what the market will do in the future.
- If purchasing a Fannie Mae owned home you will incur additional closing costs that are typically paid by the seller in the Tampa area. These costs may include the doc stamps on the deed and title insurance. Fannie Mae properties are typically only offered to owner occupied buyers within the first fifteen days on the market.
- Tampa Bank Owned Homes will usually require you to be pre-qualified with their mortgage representative even if you have been qualified with your own lender.
These tips are general in nature and every real estate transaction is unique within itself. All terms in real estate are negotiable and need to be in writing to be enforceable. Make sure you work with a qualified real estate professional to guide you through the home buying process.