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Purchasing a foreclosure in Macomb County MI – Tips & Guidelines

June 28th, 2008 · 2 Comments · tips for purchasing a foreclosure

 

Kris Wales a Macomb County MI real estate agent - buy a foreclosure in Macomb County MII have been viewing foreclosures and representing home buyers in Macomb County in their purchases of bank owned properties and decided to put into writing some of the things I have learned along the way. I hope you will find these tips helpful.

Prior to making your offer:

Always consider an offer on a bank owned home to be your “best and last” offer as many of these homes are already bargain priced. We are seeing many multiple offer situations on these homes. You may only get one chance to bid on them – make it your best offer from the start of the process.

Bank owners and/or asset managers require full proof of funds (if a cash offer) or a pre-approval for a mortgage letter with any offers submitted.

They also may require a certified or cashiers check payable to the listing office prior to reviewing an offer to purchase.

Bank sellers will want to see a closing date of no more than 30 days from the date of first offer to purchase. If you experience a delay in your mortgage approval or other reason for delaying the closing you will probably be charged a fee for each day that the closing is postponed. The bank / asset manager may also withdraw the contract and put the home back on the market.

After your offer is submitted:

Offers on bank owned homes generally take 3-7 business days to receive a response back from the lender and/or asset manager. A signed acceptance of your offer may take an additional 3-7 business days.

Bank addendums & terms to the contract of sale must be agreed to by the purchaser and signed. (There are a few exceptions to this, for the most part their terms are inflexible.)

Home inspections

Utilities will have to be turned on in your name if you desire to have a full inspection on the home.

Consider your offer to purchase with “As-Is” in mind.. Banks/asset managers will normally not make any repairs to the homes.

Inspection contingencies are normally 5-7 days from the date of sellers acceptance. (Rarely do they allow more time.) You must be ready to proceed with a home inspection quickly in order to meet the deadline.

Closing on your home:

Closing date & time are set by the title company hired by the bank owners. We have very little flexibility, if any, in choosing a time that is preferable by the purchaser.

Many bank owned homes close in “escrow”. We will arrive at closing, sign all
necessary documents and if the bank signed documents have arrived to the title company and funds have been exchanged, then you will receive your keys to the home.

If the bank signed documents have not arrived in time for the closing, you will receive your keys to the home and your closing documents at a later date. Most often this is within 1-3 business days of closing.

© 2008 Kris Wales a Macomb County MI real estate agent

http://macombhomes.com

 

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2 responses so far ↓

  • 1 Frank Schulte-Ladbeck // Jun 28, 2008 at 8:37 pm

    Sound advice Kris. I have been inspecting many foreclosures of late, and frequently the utilities are not turned on. The surprise which generally comes first is the plumbing. It is hard to see a leak when the water is not on, but I have found many when I turn on the water. Turning the electricity or gas can be dangerous, and you will need to know if there is a danger. If they are not on, ask the inspector to look at the equipment and appliances any way. We can spot some problems without having the utilities on, but it never will be complete.
    Thank you for the post.

  • 2 Kris Wales // Jun 29, 2008 at 7:12 am

    Hi Frank,

    We see a lot of that also. The winterization of these homes often times isn’t done until after the freezing in Michigan.

    Thank you for your tips. They are very helpful.

    Kris

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