Downtown Distressed Lofts:
Foreclosures, Raw Lofts, Short Sales and Must Sells
Short sales and foreclosures are the result of homeowners in distress. A “short sale” simply means the homeowner’s lender has given permission to the homeowner to sell the loft or condo for less than the remaining balance of the loan.
To accomplish this, the seller must show the lender why they are in distress, such as job loss or illness, or that home values have fallen to the point that the seller doesn’t have enough equity in the home to break even or sell at a profit. If the seller can show means to continue paying the note, it’s unlikely the bank will grant a short sale, but if it appears the seller is about to default, the bank may agree to a short sale in order to minimize its losses.
The terms of the short sale allow the seller to walk away from the mortgage while avoiding foreclosure, but the loss to the lender will be reflected in the seller’s credit report, possibly delaying their ability to repurchase a home in the near future. At the least, the next lender will require more down or demand a higher interest rate.
Once a homeowner defaults on mortgage payments, the bank begins foreclosure proceedings. The homeowner has many chances to stop the sale by paying the amount owed, until the home is put into a public auction. At that point, the homeowners loses all ability to retrieve the home. If the home does not sell at auction, it’s taken back by the bank as an “REO” which stands for real estate owned. The home then becomes an asset holding of the bank. REOs are managed by asset managers who are employed or contracted by the bank. REOs are put on the open market, often with a real estate professional who specializes in distressed sales. Foreclosures that are purchased this way typically are sold “as-is,” which means the bank has no intention to make environmental or structural repairs. So, buyer beware. When a buyer makes an offer on an REO, the asset manager decides whether or not to counter or accept, and strives to get as close to or above the original loan amount as possible.
The Price of a Bargain
While short sales and foreclosures can be bargains to buyers, they don’t come without a price. Because the lender is losing money on both short sales and foreclosures, the process to buy short sale homes takes longer and offers no guarantees to buyers. Foreclosures typically offer little or no chance to negotiate. The length of time they are on the market, deferred maintenance, and stigma hurts surrounding home values, as much as 20 percent, according to the National Association of REALTORS®. Buyers should know that building equity takes time, and that the best home to own is the one you can comfortably afford.
Distress Sales/Bank Foreclosures Hotlist – Get your copy at LAcondoInfo.com
Distress Sales resulting from bank foreclosures often represent a great way to get a fantastic deal on a loft. It’s not easy for the average loft buyer to find these deals, because you have to keep searching to see when one comes up.
If you’re the type of person who recognizes what a great deal some of these properties could represent, you will be interested to know about a new free service which automatically searches out and downloads a current list of all such properties day in and day out. When you receive this free, no obligation service, you’re automatically plugged in to the most current list of Foreclosure Properties on the market, in the price range and area that interests you. You can also have access to updates of the list as new properties are added to it.
Here’s how it works. You will receive a FREE report listing the current Foreclosure properties (including photos) in your desired price range and location. There is no cost for this information, and absolutely no obligation. This insider information, sent to you in an incredibly simple and efficient format, will give you a huge advantage over other buyers in the marketplace.
Downtown lofts have several unique opportunities for distress sales due to upside-down buyers, lawsuits, financing issues and mixed-use building issues. You can request this free “Distress Sales and Bank Foreclosures Hotlist” by visiting http://www.lacondoinfo.com/gold_distress.asp or CLICK HERE.
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DOWNTOWN LOFT & CONDO: FOR SALE | RENTALS | SUBSCRIBE | VIDEO
Corey Chambers, REALTOR®
L.A. Loft Blog, 816 S Broadway, Los Angeles, CA 90014
The #1 Downtown buyer’s agent with 19 successful buyer transactions closed in 2013, Corey Chambers is a Realtor®, and member of the Top 6 award-winning, 5-Star Yelp rated team. J.D. Power Award 2012 – Keller Williams Realty ranked Highest in Overall Satisfaction for Home Buyers and Sellers Among National Full Service Real Estate Firms. DRE#01889449