Tips Specific to Wells Fargo or Hudson and Marshall REOs- newbie

[Sarah Taylor]

Hi,

We are looking at a property that is owned by Wells Fargo, so would appreciate any bank specific advice or tips. 

It's new to the market, but the listing agent seems to have all but washed their hands of the property, not responsive and when my buyer's agent finally got a hold of some one in the office the listing agent directed him to just submit any bids directly through another 3rd party. (I am thinking it's Hudson and Marshall because it is listed there as an "auction" currently.) The realtor is out of town, a good hour away I would say. 

The home went in the MLS a little over a week ago, and I wanted to see it right away, but it wasn't ready. We were able to get in Friday, and it needs A LOT of work. It is definitely not finance-able. The bank did some cleaning out, but there is a lot left, and the home is not very secure right now nor weather proof, and winter is coming quick.

H & M is taking pre-auction bids, but has no starting point or list price. The MLS has it listed for 99k which I think is overpriced given how much work it needs. (We are going to have a contractor out to get a better idea on this, but all rooms have holes in walls, none have acceptable flooring, neither bathroom is functioning, the heating system is not functioning, there are broken out windows, though the intact ones are replacement. The roof is newer. I could go on.) The tax assessment is $180k, and I would say (rennovated) you could ask that, but would actually get closer to $160k because properties in this market tend to sell a good 10-15% below asking after sitting, it's a heavy vacation/2nd home market.

I have spent the whole weekend reading non-stop about REO, these auction sites, how to make your bid stand out etc. We have no experience with this and are not investors. We hope to buy this as a 2nd home/vacation home, it's in an area we have been watching for years, and this seems like it could be an economical way to get what we want. (I know you aren't supposed to be emotional about a specific property and look at A LOT of them and hopefully catch a deal in there somewhere, so we are breaking all those rules.) We very much are interested in this particular property.

We are thinking about getting a Home Equity loan with our primary home, using those funds to pay cash and fix the house to the point of it being finance-able. Then we would get a mortgage on the home, pay of the home Equity and use the rest to finish the renovations and get it how we really want it. Does this sound feasible? Are there major things I'm missing?

Thanks!
Sarah