Foreclosure Pricing

[Michelle Elsaid]

Hi All,

I found a foreclosure that looks like it was an abandoned renovation attempt that went into foreclosure, last purchased in the bubble. The house (looks) like its in good condition in a nice development - but has no floors installed, no appliances, and the kitchen needs to be 100% replaced, and exterior repainted.

The foreclosure is listed for sale for the same price BIGGER, TURN-KEYs in the development sell for. I want to call the lender and ask about the pricing because I assume it will go down after it does not sell anyway and attempt a FHA 203k loan, so I want to try a negotiation now - if anything it ends up being practice and experience.

It is held by a private loan servicing LLC. Any ideas on how to contact them and what to ask? Their website does not list houses, etc., only options for those whose house in foreclosure... How do these companies usually manage the sale of their properties? I don't have a realtor currently (looking for one in Orlando FL who works with investments)

Thank you!

[Andrew Davis]

Hey @Michelle Elsaid, @Gene Mills and @John Kent hit it right on the head. What the banks/asset managers are realizing is that they don't really have to discount these REO's much, if at all, to sell them.

I just pulled this chart yesterday... inventory is way down, and prices and closed sales are up.  So the banks that have been sitting on these foreclosures can now unload them in a relatively hot market.

There are still good deals out there, but they may not have boarded up windows and smelly carpet.  Use the BP rental calculator to determine if the properties you're looking at will cash flow long term.

A knowledgeable investor friendly agent like John Kent will be able to assist you with rental comps and such, in fact, it looks like he may have just saved you $15,000!