Stole Foreclosure Now What?
I bought a foreclosure last month...in perfect shape...no repairs. It appraised for $66,000 more than i paid. I have someone wanting to write a contract on it Saturday. I put it up for l/o and they want to buy it outright for appraisal value...however, i am not sure how to proceed re: seasoning & financing ...all advice is crucial...thanks in advance. CWal
Have them submit the contract and make sure before you accept that you call their loan agent. Require a pre-approval with contract.
Call the loan agent and state that you have not owned the property very long, but have to sell. Ask them who they are going to use and if there are going to be any seasoning issues.
You can also take out the contingency of getting financing and write into the contract if they can't qualify you will carry back the loan for X amount of interest with a balloon period in it after X amount of years.
dnvrkid...excellent advice...the contingency owner financing will probably not happen because the buyers have good earnings but little to put down...I have about 12k tied up & would like to get back as close to that as possible...I guess i'll just bounce it off them & see what happens...thank you so much for the good advice...you all are great...CWal
The lender should have no problem with seasoning. The property was purchased at foreclosure. Therefore, the purchase was not arms length or a market sale. Its very clear that a foreclosure purchase would be less than market value. The reason seasoning is sometimes required is to catch unlawfull/.fradulent flipping. Where one person buys, then resells to someone without market knowledge (often with an agent and an appraiser involved) at above market prices. Lenders want to know why the price is higher than it was a few months ago, just tell them you got a good deal at foreclosure. [ Edited by JasonCowan on Date 12/02/2004 ]
Jason...thanks, you just made my day...that was my biggest worry...I'm relieved...Regards, CWal