All Forum Posts by: Calvin N.

I am sure it happens but I have never had anyone ask for a lower rent than what was advertised, either my personal properties or those listed by our agency. I am sure it is all market dependent.

I have two that are held in escrow and two that are not. We just put aside the money at some point during the year to cover the taxes and insurance. Not the best way but it works.

We just purchased a SF home and closed last week on an online auction bid through Hudson and Marshall. The property was set for auction in a nearby city on a Wednesday but available for online bidding, too. We bid the previous week on a Tuesday and got called on Thursday that they accepted our offer. Listed at 56,900 and we got it for 40K.

All of the Fannie Mae listings that I have listed have the bids entered on BidSelect. We also get a lot of properties that go to auction through Auction.com.

Kendrick, It depends on the bank or asset manager but I would expect if the winterization is already done it will just be a few weeks until you see the listing. Do you know which agents in your town typical list the foreclosures? In my small town, there are only a handful that list most of the fannie mae properties, HUD homes, etc. You could give one of them a call and see if they know who will have the listing.

Best of luck!

Last two purchases are for hold and rent:

June 2009
Duplex, Fannie Mae listing
list price 74000, offered 45000, rejected
price dropped in July to 57000
offered 45000, accepted.
Closed 30 days later.
Spent $5400 for rehab.

Both units rented for $475 each within three weeks of rehab completion.

Jan 2011, Fannie Mae SF, 4 br, 1.5 bath
Watched this list price drop from 70K to 59K. Property went to auction, didn't sell, relisted, didn't sell, auction second time by Hudson & Marshall and we bid 40K. Two days after entering offer it was accepted.

We closed on it yesterday. Replacing carpet in bedrooms and painting interior. Also adding a full bath. Will be ready for rent in 30 days. Expected rent in that neighborhood is $750-800 / month.

Getting both sides of the commission is not an ethical issue. It is legal, ethical, fully disclosed and common in many cases.

As a Realtor if I "hold" an offer that I may only receive the listing commission side to submit another offer that I may receive both listing and selling sides of commissions then that is not only unethical, it is definately not in the bank's best interest.

It sounds like the seller is willing to contribute $6000 towards repairs and/or closing costs. Yes, I would factor that into your numbers. Closing costs should not be that high but you may have some repairs that are needed that you could use some of the money for.

Since most of the transactions I deal with on foreclosures require a bid placed online there would be no way to submit this type of offer. I could see this working with a local bank but not with Fannie, Freddie, HUD, Chase or other large lenders.

Max, some other things to consider - how long are the leases for? Have you seen documentation that the tenants are paying the rent? If it is a foreclosure, are they paying the bank? Did the bank find the tenants or are they a holdover from the previous owner?

The numbers appear to be a good buy. 35K for $1100 in rents. Let us know how it goes on Saturday.

Zillow is worthless in my area but in some cities they do have enough data to give you an idea of pricing. Others can give more specifics on how Zillow does in the Miami area.

REOs do have an impact on the value of your property but it depends on the market. Are REOs the majority of properties sold?

In some neighborhoods where I live there are very few foreclosures and so when there is one it doesn't have that big of an impact on the prices of the other homes. However, certain neighborhoods were hit hard by foreclosures and REOs drive the prices of all the other properties in those areas.

Are the comps you have that sold for 34K, 40K and 135K very similar to the property you are considering? Is the similarity based on square footage, # of bedrooms and baths, type contruction, etc? What kind of condition were the REOs?

Some may be move in ready while others may require extensive renovations. Give us more details and I am sure you will get lots of input.