My experience buying a foreclosure on Auction.com Real Estate |
- My experience buying a foreclosure on Auction.com
- Can you help me evaluate my listing? (House hasn't sold yet, wondering what to do)
- What things actually raise the value of a home that arent just minor cosmetic upgrades?
- We don’t know what the heck is going on
- Another cash for keys question
- I currently pay utilities for my tentants. If I stop paying these, does it count towards the annual cap on raising rent?
- Viability of an Independent real estate jnvestor
- [CA, USA] A question concerning apartment mailboxes.
- Mortgage Advice
- Maryland: Negotiating w/ Builder For New Construction
- Real estate negotiations question
- Buying first home in Southern New Hampshire - looking for tips
- I’m getting ready to rent out my Condo in So Cal. How do I get started?
- Personal property after closing
- Is it true that houses over $1M typically stay on the market longer because of fewer buyers? NJ/PA
- Which Real Estate education program for a FOB in Las Vegas
- I want to buy my childhood home back on a rent to own. Should I?
- How will this affect my property value when I decide to, someday, sell my home?
- Is it possible to start out with commercial real estate instead of residential?
- FSBO - ELIA5 - I'm the buyer in WA - what are the steps to follow in which order and who generally pays for what?
- How much impact does zip code have in same neighborhood?
- How to keep first house as an investment property and her second house
- Paid off home into rental property
| My experience buying a foreclosure on Auction.com Posted: 25 Aug 2019 12:18 PM PDT Here's a story. Timeline for Purchase of 22 Something Street, Worcester, MA I've bought 3 foreclosed properties via auction.com. Here's my most recent experience. I surf auction.com regularly in Massachusetts and particular Worcester since I am in the market for some rental property, having recently sold a different business. On April 12 I saw a 2 family for sale on auction.com. It was near another property I own and that's one of my current sweet spots. Let's call it 2 Something Street. I registered for the auction but I ended up not bidding since I was travelling and trying to de-stress a bit. When properties fail to sell or don't meet reserve on auction.com they are often automatically relisted. So you'll see the same property repeatedly auctioned. I saw 2 Something Street listed again on May 12. I registered for the auction and threw in a minimum bid since there were no bidders. This was $67,500. That property would be worth up to $250,000 I think if it were fully rented. But more importantly for me, it would have 2 units generating about $2500/month total rent. I liked it but I was still distracted by other stuff so I didn't pay much attention to the auction. I got an automated email from auction.com that I was outbid on 2 Something Street and I ignored it. I saw that the property was relisted again on May 28. This time I decided to pay attention. I want the income and I have cash that needs to be invested. I knew the property would be a steal at $150,000 so I bid that. It was a back of the envelope guess at a potential winning bid. No brains, just instinct. It's not an outrageous lowball, but it's low. There were some other bidders, but I won the auction on June 3. I saw I was below reserve so I figured the seller wouldn't complete the sale. I got a P&S agreement draft from Auction.com so I thought I might have gotten the property, but no. On June 7, I got a notice my bid was rejected. On June 16 the property was relisted. This time I started doing my homework. I drove by the property and spent a lot of time looking at photos from Google Street view. I looked up the property records at masslandrecords.com and read the online court records of the property. I calculated the bank foreclosed on the property with a loan outstanding of $185,000. That still a good price, but I figured I'd simply raise my bid, but not to that level. I bid $175,000 this time. Again, I was the high bidder when the auction ended on June 19. This time I had beaten the reserve price, which surprised me since I figured the reserve was $185K - my calculation of the outstanding loan loss. One strange thing was that the property now sported 4 "No Trespassing" signs on the porch. This was a little unnerving since those signs were obviously new. I assume that the tenants knew the property was up for auction and wanted to make sure that potential buyers didn't bother them or walk around the house or enter the house. I know that potential buyers can be aggressive so I get the reason for the signage, but it also made me a bit nervous. What kind of people lived in the house? Were they nutcases who felt wronged by losing their house to foreclosure? Would I be greeted by Messrs Smith and Wesson when I went to propose a lease? Did they have big, nasty dogs? Did they have fleas? Did they bathe? But, again, out of my control so I noted it and set that issue aside for now. The P&S specifically said I could not contact the tenants or I'd face loss of my deposit. Again I got a P&S to sign. I signed it. I sent in the earnest money deposit of $9,850 on June 21. I knew this could still be returned since the seller can reject bids even if they meet reserve - auction.com and FNMA suck that way. So now I waited. July 4th holiday was approaching. I figured I'd hear yes or no before then, but instead I got radio silence. I called auction.com a few times and I got different answers - the seller has 10 days to respond, the seller has 30 days to respond. Finally I re-read my contract. Turns out the seller had until July 17 to respond AND could automatically extend by 30 more days to August 16 at their option. In my last 2 purchases from Auction.com the sellers moved quickly and I don't recall waiting at all. So I was kind of stuck - waiting to hear if my bid was accepted, my deposit sitting with the escrow agent and me having to sit on enough cash to close in case FNMA responded. Meanwhile I won another auction for a nearby property for $200,000 on Hubzu.com. I actually won twice and both times the seller rejected my bid. They want $245K if they want their loan principal back - too much for me. To avoid buying both properties, which would wipe out my liquid cash entirely, I stopped bidding on anything else. I attended one auction in person for a 3 family in the same neighborhood but didn't bid. That property, which needed a lot of work, went for $243,000, so I was comfortable with buying this 2-family for $175,000 (really $184,000 with fees). I read the foreclosure docs. The original mortgage on 2 Something Street had been re-negotiated in 2016 but the owner apparently couldn't make the payments and the bank foreclosed and took possession in March 2018. I was nervous about dealing with the tenants, but the price was low so I figured worst case scenario I'd give myself 6 months to evict if the tenants didn't want to sign leases and become renters. I can afford some time to fix tenant issues. I consider cleaning up the rent rolls no different than doing a kitchen - you give yourself a budget and a timeline and get it done. One concern of course is that the tenants were the former owners and hadn't been paying either mortgage or rent for years. So paying rent to me would be unpleasant. But I didn't even own the property so I wasn't going to sweat this issue too much yet. Plus I wasn't supposed to contact them. July 11th FNMA finally signed the contract. Still radio silence on closing so I called the closing attorney for FNMA and spoke to a paralegal on July 13th who told me they were going to ask for an extension since FNMA was being slow with documents. They also told me I had to get my own title insurance. The P&S said FNMA would provide the buyer (me) with title insurance. It clearly says in the contract, "3.... Seller paying for and providing the Owner's Policy of Title Insurance," So this was a change and required me to get my own attorney. I read some blog posts on biggerpockets.com which also made me think I needed my own attorney and title insurance when dealing with FNMA. I quickly called a law firm I had used on my last property and they agreed to represent me. Only July 19, the day we were supposed to close I got a docusign addendum to extend the closing to July 25. I was kind of annoyed that I had not actually heard from FNMA. In addition, the addendum had a line "Time is of the essence with regards to settlement date." What the fuck does that mean? Is this some passive-aggressive bullshit implying I'm the delay? Fuck that. I'm not the delay. My earnest money deposit and signature on the P&S were done on June 21. So I emailed the closing attorney asking if we should delay another week. But then on Tuesday, July 23 I realized I get nothing by being a dick so I signed the addendum. Over the next few days I had a few discussions with Auction.com explaining that the contract, signed by FNMA, said they would provide my title insurance and insurable title. Auction.com repeated that in Massachusetts this is apparently not possible - some sort of conflict of interest thing - the seller cannot provide title insurance for the buyer. Also, I was supposed to pay for it. The amount of money we are talking about here is peanuts. Title insurance is maybe $500. So in the scope of a $185,000 transaction it's nothing. But it was really annoying to have the closing delayed, blame me for it, then tell me I had to get my own lawyer, title insurance at my own expense. Anyway, fuming doesn't get you properties, so I told my lawyer we should just get it all done. Meanwhile, I asked auction.com to ask FNMA to pay for my title insurance. And, on July 25, they agreed to do that. So we were finally headed for a closing. On July 25 I got a notice from Docusign to sign an addendum to the P&S. I figured this was a modification of the agreement to show I was providing my own title insurance and they would pay for it, Nope. In fact, it was a copy of a docket from a housing court lawsuit showing that the existing tenant is the former owner and is claiming the entire foreclosure was wrong and she should be awarded the house by the judge. This is a non-starter and my lawyer agreed. I can't buy a property where my ownership, no matter how unlikely, could be lost with a stroke of a pen by a judge. In fact, what really happened is this: FNMA agreed to sell me the property and provide insurable title. In fact, in Massachusetts, and perhaps other places, title insurance companies won't insure title if the former owner is a resident of the house. They won't take the risk. FNMA signed a P&S agreement they couldn't honor. So FNMA, in one of the stupidest moves I've seen in real estate, filed an eviction on the tenant/former owner so that they could sell the property to me. The former owner naturally filed a response to the eviction with all sorts of shit about the foreclosure being wrong, the mortgage being wrong, etc. I would have dealt with the former owner myself and even taken the property without title insurance. My lawyer told me that was ok. And I would have approached the tenant myself and dealt with this issue with a cash for keys or some other sort of deal. One of the things I feel I'm good at is solving issues like that. But once the eviction was filed and tenant made claims about the foreclosure, I couldn't buy the property. There was a bunch of back and forth with Auction.com I wont' bore you with. Basically, I told FNMA that since they can't honor the contract and provide insurable title, I wanted my Earnest Money Deposit back. The alternative, I suggested, was the reduce the price by 75% - 25 cents on the dollar, and I'd buy the house as is for like $47K. FNMA reject my offer to buy the property at a discount. I got my deposit back in Mid-August. The property is no longer on the market as the eviction works its way through Mass Housing Court, which could take weeks or months. Tl:dr: I tried to buy a foreclosure. FNMA didn't know that in MA foreclosuure property title is uninsurable with former owners resident. FNMA files for eviction without talking to me. Deal falls apart because eviction court case makes property unsaleable. 4 months wasted. edit: user u/AlonzoSwegalicious explains the risk of buying a property like this. Maybe FNMA did me a favor. [link] [comments]  |
| Can you help me evaluate my listing? (House hasn't sold yet, wondering what to do) Posted: 25 Aug 2019 06:35 AM PDT Can you help me evaluate my listing? Our house has been on the market 35days, and has been seen by dozens of people. We have received two offers (one for 800K we didn't respond to, and one for 855K we counter offered 960K. The people wouldn't go over 900K so it died) The lowest we would like to accept for our house is 930K, but we would be ok with 915K as the ABSOLUTE lowest. We are pretty convinced a few years ago we could have gotten over 1 million, but the market has changed quite a bit as everyone knows. Our taxes are only 14K which is extremely low for Bergen County. Can someone offer us advice: 1) How is our listing? 2) Is our lowest price of "915-930K" realistic for my area? 3) Anything else we should do? Any advice would be great! We aren't in a rush to sell, so we aren't considered "desperate sellers." [link] [comments]  |
| What things actually raise the value of a home that arent just minor cosmetic upgrades? Posted: 25 Aug 2019 09:00 PM PDT Hi everyone, So I don't really know much about property values and how they are assessed, but I've been wondering what can a homeowner do to raise the value of their home? I don't mean things like new paint or a new backyard fence, but do things like a new Roof or a new Heater/AC help? I mean what do assessors even look for? Thanks! [link] [comments]  |
| We don’t know what the heck is going on Posted: 25 Aug 2019 05:51 PM PDT My fiancé got an offer on his house in July so that our closing date would be end of August. However...we're not sure if the buyers are about to back out or are still going through? Situation: The people who bought our house made the offer the same day on an FHA loan. Inspection was done within a week. Appraisal done within 2 weeks with a rush order to do it on the same day. What's weird and is what is making us worried is their lack of communication. Their agent hasn't been talking to our broker at all for pretty much this entire process. Everything they've done have been all notified either the day of or a day before. Now, we're on closing week and we haven't heard a word at all from them. Our broker contacted escrow and was informed they ordered the closing papers. He contacted escrow again a couple days later and was informed now the lender, agent,and buyer have not responded at all. Our broker believes something is wrong and that there's now only an 80% chance they are actually going to close or extend their closing date. Either way I have to think the worst and think they're backing out. It just sucks because we're banking on them in order to get our new house. Has anyone experienced this and what the outcome results were? [link] [comments]  |
| Another cash for keys question Posted: 25 Aug 2019 03:06 PM PDT Hey guys, just a quick question about how negotiating a cash for keys offer would work in my situation... Deutsche Bank bought the foreclosed property I'm living in here in DC. They offered my roommate $4000 to leave before they tried to start an eviction process. We had a hearing scheduled for the 21st but we'd already established with their lawyers ahead of time that we are bona-fide tenants of the property and they agreed that they have no case and will move to dismiss it. They made another offer at the time of the hearing (which their lawyer said he didn't even want to insult us with) for $3000 each, which we declined and counteroffered. The case was dismissed and before we left he said he would be in touch with their response, but we haven't heard anything yet. I'm curious how they'll go about negotiating - do they do it themselves, run it through an algorithm, vote on it, contract a broker or what? Their offer for 3k was to be out by September 1st, so I assume their next one won't be for the same date. How soon and in what manner are they likely to get in touch with us? [link] [comments]  |
| Posted: 25 Aug 2019 07:35 PM PDT I live in a province where annual rent increases are capped at 2.5% I'm trying to restructure the payouts for my tenants and move away from paying utilities. Cheers! [link] [comments]  |
| Viability of an Independent real estate jnvestor Posted: 25 Aug 2019 07:34 PM PDT I started looking into different types of investment and real estate was one of the paths that stood out to me. While I was searching for what it took to invest in real estate, I noticed many successful agents are part of a brokerage group/company and wondered if that was the most effective way of real estate investment. A quick google search told me that having a broker or being a part of a brokerage isn't a necessity, but helps with the process. Do I need a broker/brokerage to be a successful real estate investor? What's the viability of being an independent investor? I ask about this since I heard you recieve a commission based on your sale that's less than the total profit made off the property (I assume the rest of the money goes to the broker/brokerage). // sorry if some of my statements are misinformed, I'm entirely new to the nuances of real estate and hope to have the knowledge needed to invest when I turn 18 [link] [comments]  |
| [CA, USA] A question concerning apartment mailboxes. Posted: 25 Aug 2019 07:28 PM PDT Hello, I was wondering if anyone here associated with running an apartment complex knows if non-residents of that complex are able to lease a mailbox? Thank you for any and all replies! [link] [comments]  |
| Posted: 25 Aug 2019 07:10 PM PDT Hi everyone! Just looking for some advice on a partnership I am entering into. Someone I know and myself have put a down payment on a townhouse, and I just want to make sure the deal is fair to both of us. Being that he is in a different financial situation than I am, we went in on the down payment at about 68% - 32% split, with myself having the lower percentage. The deal will be I will be living in the townhouse, and will have roommates in there to help cover the mortgage. We will be cash flowing about $200/month, and that will go into a joint bank account that we have. I will be paying my share of the "rent" for a room as well. We are on a 5 year term, and if we decide to split ways after the term, the percentage will come into play. I get my down payment back, he gets his, we split appreciation. Is this a fair deal for both of us? I just want to make sure we get everything covered and understood between us, as we are meeting with lawyers this week to write up a contract. "Good contracts keep good friendships." Thanks for reading! [link] [comments]  |
| Maryland: Negotiating w/ Builder For New Construction Posted: 25 Aug 2019 11:18 AM PDT Greetings, r/realestate! I am considering purchasing a new construction home in Maryland. Can someone tell me about their personal experience (i.e., not through the use of an agent) of negotiating options and closing costs with builders? I already know they will not drop the base price of the home, but I would like think that if I were to choose X amount in options, I would have a strong argument in saying, "If I add _____ option, would you throw in _____ option?" If negotiation is not likely with options, how about with closing costs (especially if I use their "preferred lender")? Would appreciate any feedback r/realestate can provide... thank you! [link] [comments]  |
| Real estate negotiations question Posted: 25 Aug 2019 06:42 PM PDT Sellers will consider previously rejected offers when they can't sell a home. However, do sellers ever re-contact a buyer after they terminated a contract? I.e. do sellers ever change their mind and agree to the buyers terms after the buyer has already walked away? Has anyone experienced or heard of this happening? [link] [comments]  |
| Buying first home in Southern New Hampshire - looking for tips Posted: 25 Aug 2019 02:51 PM PDT We're looking to close on a home somewhere in southern NH. We're debating whether it's a good time to buy or not, with all the talks of a coming recession. Generally speaking, what should be considering when it comes to buying a home in this area? One of the things that keep getting brought up are septic tanks- is it a concern if the seller has no record of servicing the tank, no idea who installed it, etc? If a property is tax assessed at 100k below seller's asking price, is that a red flag? Thank you! [link] [comments]  |
| I’m getting ready to rent out my Condo in So Cal. How do I get started? Posted: 25 Aug 2019 04:46 PM PDT What kind of documents/contracts do I need and where do I get them?How do I advertise it? It's in a good location and I'm looking for long term tenants. How much should I put aside for taxes? I plan on renting it out for $1700-$1800 and my monthly costs are right around $1400. [link] [comments]  |
| Personal property after closing Posted: 25 Aug 2019 10:39 AM PDT My husband and I closed on our dream house a little over a week ago. The sellers left behind a few items of moderate value including barstools, a fire pit, garden hoses, etc. Now a week later, I received a phone call from their agent asking for some of their stuff back. As part of the contract, anything remaining on the premises became ours at the time of closing. What I really want to tell them is "tough cookies", buuuut, the thing that makes it tricky is their agent is actually our next door neighbor. I've become "friendly" with her over the course of the sale and I don't want to jeopardize that relationship. Should I just cordially reply and say "unfortunately, according to the contract, those items are now under our possession," or should I be the bigger person and return what they're asking for? Edit: Thanks for all the replies. I will probably end up giving them back their stuff with the clear understanding that this is a one time courtesy. My biggest concern is opening up the door to future requests and them feeling like they still have ownership of the house and/or contents. To provide more context, the sellers had 3 months between signing the contract and closing, there was plenty of time for them to move items into storage. We were very accommodating during the buying period, extending the closing date at their request. It is also a minor inconvenience for us to get rid of the items as our town charges for disposal of large items. (like fire pits) [link] [comments]  |
| Is it true that houses over $1M typically stay on the market longer because of fewer buyers? NJ/PA Posted: 25 Aug 2019 04:33 PM PDT My family is looking at a vacation property that is just over $1.2M in an area that ranges from $400k-$6M (from what I can tell—we're new to this area). It's a unique property that has been owner occupied since the early 90's when it sold for $400ish. (So unique that comps seem to be somewhat hard to come by). It's been on the market for 3 months and we're trying to gauge, realistically, how much wiggle room there might be in the price. We're still in the process of finding a real estate agent to help us with this transaction but a friend who considers themselves real estate savvy mentioned that houses over $1M typically stay on the market longer so the fact that there haven't been any offers yet isn't an indication of it being priced too high. I find that hard to believe. Thoughts? [link] [comments]  |
| Which Real Estate education program for a FOB in Las Vegas Posted: 25 Aug 2019 03:08 PM PDT Hello guys, Firstly, I'd want to thank you for your time reading this thread and any advice will be highly appreciated. So here is my situation: I am 30 years old, I have been working in the creative / advertising industry in both Asian and American markets for 11 years and I do feel I am no longer fit in with the industry. Since the beginning of 2019, I've found myself enjoy driving around neighbor hoods to self evaluate properties and visiting open houses. Talking about financial planning and real estate in general does take all of my attention. So I decide to take courses/class to purposely gaining more knowledge to prepare myself for my first house buying experience which will come in mid 2020 and also to start using my properties to start generating passive income. I have an Australian Bachelor degree in Multimedia Design and I have only lived in the US (Henderson Nevada) for 4 years. Could you guys please advice what program should I take to start learning about Real estate? I'd prefer a deep, practical and comprehensive course than a course to get licensing since this is for my own knowledge. Should it be online courses or local college school is suffice? And with my AUS bachelor degree of more than 10 years ago (which I also don't have a record since I moved to the US), is there anyway I can start the course without having to meet the typical college requirement as in GED, etc? Thank you again for your time. [link] [comments]  |
| I want to buy my childhood home back on a rent to own. Should I? Posted: 25 Aug 2019 02:59 PM PDT I am 29 years old and up until the end of July 2019 I had lived in the same house in Phoenix my entire life. My grandma owned it and sold it to a Canadian buyer for 150 grand. Other houses on the same block are going for 220-230. This was a home built in the 1950's but in a state of decay. Saw a family picture and it still had the same fuse box from the 1950's. This guy who bought the house hires my uncle to do the HVAC for all his properties in Arizona. Through him is how I discovered it was a rent to own. Now I just started a new job at Costco that pays 1800 a month but I have the opportunity to work into full time and to a higher tier within the company and I plan on staying her for a long time. Basically I want my house back. The past month I have been sleeping on a yoga mat on my grandmas living room floor and I am going to be moving into an apartment next week. Losing my home has changed my life. Its my dream to buy the house back and I was wondering does a rent to own make sense? I heard the new owner is investing 30-40 grand in fixing it up. I also need to find a way to contact him. But before I do should I try this or is rent to own a scam? If I was worth $1 billion dollars I would be willing to pay $999 million for that home back. Thats how much it means to me and its my goal in life. It has so many memories and that is priceless. [link] [comments]  |
| How will this affect my property value when I decide to, someday, sell my home? Posted: 25 Aug 2019 02:34 PM PDT We live in a nicer/desirable subdivision. New construction is priced at $200,000 and they are selling the new homes fast. Our house is a 3BR, 2BA with an upstairs bonus room, 2 car garage, pool, woodworking shop with electricity, on about a .8 acre lot. The wooded lot (.75 acre) next door came up for sale so we decided to purchase it. The plan is to 1) expand the fenced area of our yard and 2) construct a second garage (with electricity) to store a large camper and 2 cars. Would the addition of this planned second garage be a turn on or a turn off to a potential buyer if/when we chose to sell our home? [link] [comments]  |
| Is it possible to start out with commercial real estate instead of residential? Posted: 25 Aug 2019 02:18 PM PDT Hi all, Located in California. Is it possible to tart out doing commercial real estate opposed to residential? I have completed my RE courses and realized I have no desire to do residential, but commercial interested me and I'd prefer to work on that side of things. For those that do commercial and or both, what are the major differences and is it smart to start doing commercial? Is there any need to know info before pursuing it? Thank you!! [link] [comments]  |
| Posted: 25 Aug 2019 05:47 PM PDT FSBO - ELIA5 - I'm the buyer in WA - what are the steps to follow in which order and who generally pays for what? I have no agent or attorney and am not interested in an agent or attorney, would just like to know the process and steps that generally take place. I'm in the state of Washington. 1 I've found the house, it's FSBO.2 The mortgage company has given me an Pre-Approval Certificate for more than the asking price.What would the next steps be, and in which order and who generally pays for what? Is there a way to get an appraisal before I make an offer? And building inspection? any process gotchas to watch out for ? any comments gratefully accepted. Thanks [link] [comments]  |
| How much impact does zip code have in same neighborhood? Posted: 25 Aug 2019 07:44 AM PDT We are considering building a home. We have two location options with the same builder and in the same development. One side has a zip code and town name of a very upscale area (Brentwood TN). The other side has a zip code and town name of a higher crime area (Antioch TN). Both are in Nashville Davidson county, same utilities, taxes, schools, etc... Thinking about resell, how much does it matter? [link] [comments]  |
| How to keep first house as an investment property and her second house Posted: 25 Aug 2019 07:17 AM PDT Morning everyone. Question from Alberta about investment growth. My husband and I want to buy a bigger house in the 460$ range. We have a house in the 320$ range. How do we keep both? We can put about 50$ on the new house from our accounts without the sale of our existing house, but the 90$ or 20% requirement might be out of our reach. Is there something we can do at the bank?
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| Paid off home into rental property Posted: 25 Aug 2019 01:09 PM PDT I live in a property that doesn't have a mortgage. I am interested in moving out and making it into a rental. My question is how best to take as much equity out as possible? I wish to also wish to have minimum tax implications of course. I live in Florida. [link] [comments]  |
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