# Foreclosure home?



## Haldor (Nov 30, 2006)

Place bid on home...turns out it is in foreclosure and our bank declines to finance. Wow!?! Is there a "disclosure" law where the seller is required to inform of outstanding debt/lien on their property? I'm blindsided and if anyone has experience please add your opinions! thanks all, i guess I should not be surprised in todays world.:help:


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## blgoose44 (Oct 10, 2008)

Was there no short sale option?
You were in no way related to seller, correct?


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## bigcountrysg (Oct 9, 2006)

If this is your dream house, then go find a different bank. If not then I say you decide if the headache of the purchase is worth the results.


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## WoW (Oct 26, 2010)

Haldor said:


> Place bid on home...turns out it is in foreclosure and our bank declines to finance. Wow!?! Is there a "disclosure" law where the seller is required to inform of outstanding debt/lien on their property? I'm blindsided and if anyone has experience please add your opinions! thanks all, i guess I should not be surprised in todays world.:help:


 


At what stage of the foreclosure process is this particular seller?

There is no disclosure that the seller is required to make regarding the lein, only that the seller will be able to convey clear title at close.

What did your buyers agent say about this? 

Your bank declining to finance is unusual (if it appraises and meets loan criteria) so I suspect that there is something more going on that you have not included in this scenario.


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## Haldor (Nov 30, 2006)

No short sale or related. this is our home to be so will keep trying. the home wont be "clear" till June. We have/had? pre-approval and waiting for our agent to explain. Yet our bank said "Not in our interest"? Our as in their or our as in not a good loan? PK is home and on the phone now...Will give more info as revealed to us. Again Thanks! Need some more input/opinion!


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## sgm22325 (Dec 31, 2009)

How did you find this house? Was it on the market? Is this a bank selling it or is the owner trying to sell before they are foreclosed on. Is the foreclosure process in the redemption period? If so, the owners can still redeem the property until their redemption period is finalized. There seems to be more to it than than has been explained.


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## WoW (Oct 26, 2010)

Haldor said:


> No short sale or related. this is our home to be so will keep trying. the home wont be "clear" till June. We have/had? pre-approval and waiting for our agent to explain. Yet our bank said "Not in our interest"? Our as in their or our as in not a good loan? PK is home and on the phone now...Will give more info as revealed to us. Again Thanks! Need some more input/opinion!


What do you mean "clear"? That is not a term I am familar with in relation to a pre or post foreclosure sale.

Something still doesn't sound right...


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## Greenbush future (Sep 8, 2005)

I would be questioning my realtor as to why it wasnt made clear upfront about the status of the home.
I would have also checked with my mortgage company to ensure they would even do this kind of transaction.

Offer comes or is made after all information is made available to the buyer. 

[/COLOR]
Are you saying bank meaning mortgage company?

If no, then I would consider dealing with a mortgage company, might provide some flexibility. 

Banks have 0 interest in selling foreclosed homes, they will be reimbursed well over 100% of all losses by the federal govt (you and me) for the bad mortgage, so dont be suppressed if they say no to any offer you make.

Knowledge is power- Use it well, and often


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## Scott K (Aug 26, 2008)

Are the people that were foreclosed on still living in the house?


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## Scott K (Aug 26, 2008)

Greenbush future said:


> [/COLOR]Banks have 0 interest in selling foreclosed homes, they will be *reimbursed well over 100% of all losses by the federal govt* (you and me) for the bad mortgage, so dont be suppressed if they say no to any offer you make.



Where did you get this from? I'm sure that is not true. Where did you get this from?


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## WoW (Oct 26, 2010)

Greenbush future said:


> I would be questioning my realtor as to why it wasnt made clear upfront about the status of the home.
> I would have also checked with my mortgage company to ensure they would even do this kind of transaction.
> 
> Offer comes or is made after all information is made available to the buyer.
> ...


 

True enough but, it pays to obtain some first...


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## radiohead (Apr 11, 2006)

There are huge pieces of the story missing here that would prevent even a qualified expert from advising you. You're getting a lot of advice here, most of it from people unqualified to do so in the first place.
I do this stuff for a living. If you want to PM your phone number I'd be happy to call you and get the rest of the story and advise accordingly.



Haldor said:


> Place bid on home...turns out it is in foreclosure and our bank declines to finance. Wow!?! Is there a "disclosure" law where the seller is required to inform of outstanding debt/lien on their property? I'm blindsided and if anyone has experience please add your opinions! thanks all, i guess I should not be surprised in todays world.:help:




_OutdoorHub Mobile, the information engine of the outdoors_


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## Fishndude (Feb 22, 2003)

I can think of two situations where this might be problematic.
1) The Bank you went to for financing is the same bank that currently owns the house, after foreclosing on the previous owners, and they just want the property off their books, and
2) The mortgage that was foreclosed on was done in the name of MERS, and due to pending litigation with MERS, the bank is reluctant to take a chance in financing until the MERS legal matter is worked out. An awful of mortgages were filed in the name of MERS in the last 10 years, and this litigation should get pushed through the court system pretty quickly. But I would imagine it might end up with the Supreme Court at some point. 

I work in the biz, and can only think of those two scenarios; although there surely could be something I haven't thought of. There are a LOT of homes for sale, right now. If this isn't your drop-dead dream home, why not shop around and find a different property to buy?


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## Firefighter (Feb 14, 2007)

Greenbush future said:


> I would be questioning my realtor as to why it wasnt made clear upfront about the status of the home.
> I would have also checked with my mortgage company to ensure they would even do this kind of transaction.
> 
> Offer comes or is made after all information is made available to the buyer.
> ...


I've heard the same thing. Tried to purchase a short sale home 6 months ago. After negotiations, seller settled on a price with us. 2 months later, we get a counter offer from the bank, that was HIGHER THAN THE ORIGINAL ASKING PRICE THAN THE HOUSE!?!?! I was told banks rather the property foreclose so they get paid more...

No wonder our economy will NEVER recover. I wish every single person involved in running this game spend the rest of their lives in prison. I've got no problem shelling out more taxes for that.


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## WoW (Oct 26, 2010)

Firefighter said:


> I've heard the same thing. Tried to purchase a short sale home 6 months ago. After negotiations, seller settled on a price with us. 2 months later, we get a counter offer from the bank, that was HIGHER THAN THE ORIGINAL ASKING PRICE THAN THE HOUSE!?!?! I was told banks rather the property foreclose so they get paid more...
> 
> No wonder our economy will NEVER recover. I wish every single person involved in running this game spend the rest of their lives in prison. I've got no problem shelling out more taxes for that.


 
You need to understand something about short sales. They are subject to third party (at the minimum) approval. That means, no matter what the seller agrees to (even in writing) it is all up to the people (one or more lenders) that are holding the paper. It is not unusual for a seller to agree to a low ball (since they aren't walking away with anything anyway) but the bank(s) that are taking the hit refuse to go that low.

There is a certain amount of truth about the story that there is money that banks receive if they actually do obtain the Sheriffs Deed to the property. While those truths seem like a racket, rest assured, most lenders do not want additional properties on their books. They are in the business to loan money, not obtain and sell real property.

All too often, people just don't understand the entire process and understandably get upset if things don't go their way.


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## radiohead (Apr 11, 2006)

Not to mention "the bank" is generally simply servicing the loan. There is an actual investor (individual and/or entity) who's money is actually on the line in the transaction and in the case of a short sale makes a business decision.




WoW said:


> You need to understand something about short sales. They are subject to third party (at the minimum) approval. That means, no matter what the seller agrees to (even in writing) it is all up to the people (one or more lenders) that are holding the paper. It is not unusual for a seller to agree to a low ball (since they aren't walking away with anything anyway) but the bank(s) that are taking the hit refuse to go that low.
> 
> There is a certain amount of truth about the story that there is money that banks receive if they actually do obtain the Sheriffs Deed to the property. While those truths seem like a racket, rest assured, most lenders do not want additional properties on their books. They are in the business to loan money, not obtain and sell real property.
> 
> All too often, people just don't understand the entire process and understandably get upset if things don't go their way.


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## Mark S (Nov 4, 2009)

Do a Google search under government reimbursement of forclosed loans. Not only are they being reimbursed on all federally insured loans but the top 5 lenders are being investigated for fraud. Seems they have ben inflating values and submitting false documents.


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## WoW (Oct 26, 2010)

Heck, if people are doing google searches, type in mers litigation and pull up a chair...

What it all means on potential foreclosure sales is that many have been put on hold----even personal property evicitions on property already deeded at a Sheriffs sale.

What a friggin mess...


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## Haldor (Nov 30, 2006)

WOW! Thanks all! It is a mess and we retracted offer till confirmation of deed/title/survey and debt on home. Foreclosed owner still living in home an has month or so to "redeem". I can/will not disclose |"Predatory Lender|" name but if googled is a big player in the foreclosing process. Feel sorry for home owner as it appears is a very hard place. Still not enough info to completely give up on home so now how much to invest in legal advice? Will hopefully have more info Monday. Awaiting for our Rep's e-mail now but 6min till 5 so am not holding breath. Again each has given help and thank you all. Sincerely Haldor


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## WoW (Oct 26, 2010)

Haldor said:


> It is a mess and we retracted offer till confirmation of deed/title/survey and debt on home. Foreclosed owner still living in home an has month or so to "redeem".


Smart move. There is little chance of you getting the closing done (and title conveyed) in a month even if you were offering enough for the seller to satisfy the amount owed.

Right now is a terrible time to get answers because one hand at the lender will not necessarily know what the other is doing. Even if you did get answers, it wouldn't be smart to tie up your money relying on them.

What I don't quite understand is why your agent didn't make you aware of all the pitfalls of trying to enter into a binding contract at this stage of the game.


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## Greenbush future (Sep 8, 2005)

Mark S said:


> Do a Google search under government reimbursement of forclosed loans. Not only are they being reimbursed on all federally insured loans but the top 5 lenders are being investigated for fraud. Seems they have ben inflating values and submitting false documents.


Tried to explain this in different words at the start of this thread and was smoked by folks who seem to feel otherwise. Laughable regarding the reality of the situation. 
Happy house hunting, there are some great deals out there, and the time to buy is now!


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## PLUMMER47 (Dec 9, 2006)

I've done 37 foreclosers in the last 18-24 months. Homes, commercial properties, condo's and apartment buildings. None of it had any kind of consistency other than the fact that the bank winterizations and up keep were beyond horrible and done by unqualified handymen. I've seen some very quick flips, like, foreclosure finalized on monday, bought on wed and resold by friday. Or atleast 3rd party tenants were in there. ???? I understand that once its in foreclosure the HO doesn't have the final say on anything, and they are supposed to keep up the property till its finalized. I see them striped to bare studs, some that are vandalized so bad that they are unlivable. Literally sawzalls thru stantions , and cut every wire,pipe, joyce and exterior walls. 

One thing I will say, contact your local building department and have them inspect the home, or find out what their requirements are for obtaining a C of O when required. I have had alot of new homeowners getting nice deals only to find out cities like warren roseville sterling hieghts and a few others requiring full permits inspections as if it were a new construction. They end up paying thousands more just to get the C of O.

Good luck


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## WoW (Oct 26, 2010)

Oh, and don't ignore our wonderful new construction code and lead based paint requirements. Depending on local officials, this could really get crazy on the fixit and flip it game or on rental rehabs.


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## Manthus (Jul 5, 2010)

PLUMMER47 said:


> I've done 37 foreclosers in the last 18-24 months. Homes, commercial properties, condo's and apartment buildings. None of it had any kind of consistency other than the fact that the bank winterizations and up keep were beyond horrible and done by unqualified handymen. I've seen some very quick flips, like, foreclosure finalized on monday, bought on wed and resold by friday. Or atleast 3rd party tenants were in there. ???? I understand that once its in foreclosure the HO doesn't have the final say on anything, and they are supposed to keep up the property till its finalized. I see them striped to bare studs, some that are vandalized so bad that they are unlivable. Literally sawzalls thru stantions , and cut every wire,pipe, joyce and exterior walls.
> 
> One thing I will say, contact your local building department and have them inspect the home, or find out what their requirements are for obtaining a C of O when required. I have had alot of new homeowners getting nice deals only to find out cities like warren roseville sterling hieghts and a few others requiring full permits inspections as if it were a new construction. They end up paying thousands more just to get the C of O.
> 
> Good luck


LOL - I have done over 90K in winterizations since '06. I agree.


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## JimP (Feb 8, 2002)

PLUMMER47 said:


> I've done 37 foreclosers in the last 18-24 months. Homes, commercial properties, condo's and apartment buildings. None of it had any kind of consistency other than the fact that the bank winterizations and up keep were beyond horrible and done by unqualified handymen. I've seen some very quick flips, like, foreclosure finalized on monday, bought on wed and resold by friday. Or atleast 3rd party tenants were in there. ???? I understand that once its in foreclosure the HO doesn't have the final say on anything, and they are supposed to keep up the property till its finalized. I see them striped to bare studs, some that are vandalized so bad that they are unlivable. Literally sawzalls thru stantions , and cut every wire,pipe, joyce and exterior walls.
> 
> One thing I will say, contact your local building department and have them inspect the home, or find out what their requirements are for obtaining a C of O when required. I have had alot of new homeowners getting nice deals only to find out cities like warren roseville sterling hieghts and a few others requiring full permits inspections as if it were a new construction. They end up paying thousands more just to get the C of O.
> 
> Good luck




Some evictees are trashing foreclosures horribly.
In other cases the strippers are moving in to vacant dwellings and taking appliances, furnaces, metals.

We looked at about 25 foreclosed homes in '08, almost gave up on that direction.
Wiring and copper plumbing stripped.
Toilets, sinks, tubs smashed.
Anti freeze in the wells, concrete poured onto the septic lines, 12" holes punched in the doors and drywall. Spray paint and motor oil on carpets and walls.

We did find this gem finally. It was the brother of the neighbor's originally, and was forclosed due to a subsequent owners passing. It was watched for security and only minimal deterioration like paint and heavy yard work after setting vacant 2 years.

Fannie Mae took the first offer. :0)


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## Downriver Tackle (Dec 24, 2004)

jimp said:


> Some evictees are trashing foreclosures horribly.
> In other cases the strippers are moving in to vacant dwellings and taking appliances, furnaces, metals.
> 
> We looked at about 25 foreclosed homes in '08, almost gave up on that direction.
> ...


 Probably 10-15% of the homes within a few blocks of me are foreclosures. It's amazing what happens to those homes. I'll use the one right across the street from me as an example. The homeowners took even the door knobs with them. Central air, furnace, and hot water tank also. When the banks cleanout crew showed up, they took sink fixtures, pipes, and a bunch of other stuff. Called the Lincoln Park PD and they don't respond to foreclosure issues like that.  The sherrif showed up a few days later to do his thing and there was already a squatter living there who kicked in the back door. Sherrif chased him off, but within a week, a lady with a very young baby moved in as a squatter. Kids in the neighbor hood love to throw rocks at the windows. Since the PD doesn't care and refuses to do anything, we have no choice but to sit back and watch the house go to hell. 

Then you have the other foreclosures. Its a regular sight on the way to work and see several foreclosures with their doors kicked in overnight and stripped bare.
_Posted via Mobile Device_


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