Apr 30, 2012

Top Tip to buy a Dallas Foreclosure

Want to get a great deal on purchasing a foreclosure? Looking to buy an REO ( Real Estate Owned) property for a bargain? You'll need a strategy and a good agent.

But I'll let you in on something before my tip.

For the past 3 years we've been hearing that foreclosures are about to flood the market. It hasn't happened and it still isn't happening. And I don't think it will. Banks are releasing their inventory in controlled numbers. They don't want to drive prices down with too many distress sales on the market. And they still prefer to reduce their losses with a short sale. So forget about the flood of foreclosures everyone keeps waiting for.

Here is the best tip to buying a foreclosed property in Dallas:

Make an offer the bank is likely to accept. Lots of folks think that they can get a steal on a foreclosed property by making a low offer to take it off the bank's hands. Wrong. Take this advice from California Realtor Carl Medford:

"You would think this myth would be dead by now. Unfortunately, like Elvis sightings, it just won’t go away. Here’s the truth: Banks want REOs sold in 30 days or less, so they typically appear on the market priced slightly under comparable properties. If the property doesn’t sell quickly, the bank will lower the price after about 30 days.

Lowball offers are ignored and are, quite frankly, a waste of everyone’s time and effort. You might get a deal by offering a lower price on a foreclosure that’s been sitting on the market for more than 90 days, but remember that there are good reasons it’s gone unsold for so long. And even if you have cash, your lowball offer won’t be accepted - seriously."

Carl is right. Work with an agent who knows the system and can advise you if the property is really a bargain or not. If you're a real buyer, you'll need to show the bank in order to get your deal. And make an offer they are likely to accept.

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