Atlanta Homes, Buckhead Homes and Real Estate » Atlanta GA Foreclosure

Tips To Successfully Navigate The Purchase Of A Foreclosed Home

Marc — Wed, 07 Mar 2012 03:20:23 +0000

Tips To Successfully Navigate The Purchase Of A Foreclosed Home

Guest post by Marc Rasmussen – Longboat Key condos

In this market, prospective home buyers are likely to encounter foreclosed homes as they tour potential properties. When considering the purchase of a bank owned home, potential homeowners often want to know what steps they should take to protect themselves and ensure that the property is a good investment. Avoiding buyer’s remorse when purchasing a foreclosed home does require a homeowner to take on the responsibility of due diligence to avoid unwanted surprises. By following a few additional steps, homeowners will have the necessary information to decide if buying a foreclosed property is a good choice for them.

The first step in successfully finding a foreclosed property is to hire a real estate professional who has negotiated many transactions involving bank owned properties. A good real estate agent will be able to walk you through the process, manage communication with the lender who holds the property, and refer you to other needed professionals along the way, such as title companies, real estate attorneys and home inspectors.

Once you have identified a property, it is time to do serious research. Many homes in foreclosure have been vacant, or neglected, for months or even years. During that time the home may not have received maintenance or repairs, so a thorough home inspection and termite inspection is in order. Ask the inspectors to provide a detailed report of currently needed repairs, and the status of all major systems in the home, such as the roof, electrical, and plumbing, to help identify upcoming maintenance projects as well. Because foreclosed homes are typically purchased ‘as is’, the buyer must be willing to take on these repairs.

Next, have a professional conduct a records search for the property. Prospective buyers are often not aware that tax deficiencies can impact the sale of a foreclosed home. Having a thorough title search and records check will protect a buyer, ensuring that they receive full rights to the property.

Prospective buyers should also take time to tour the neighborhood. It is best to do this not just on weekdays, but evenings and weekends as well. Does the neighborhood have many vacant and foreclosed homes? Does it feel secure and stable? Are there good schools? The stability of the neighborhood contributes to your peace and wellbeing while living there, and impacts value when it is time to sell.

For many prospective home buyers, the process of finding and purchasing a home is a daunting one. Add to that the additional issues that accompany the purchase of a foreclosed home, and having a real estate professional familiar with executing the purchase of foreclosed properties is essential to ensuring a smooth transaction.

Marc Rasmussen | Broker/Owner of DWELL Real Estate | c 941.812.6272 | marc@luxurysarasotarealestate.com | LuxurySarasotaRealEstate.com

Synovus Boldy Unloading Foreclosed Homes

admin — Thu, 20 Aug 2009 03:08:45 +0000

Synovus, headquartered in Columbus, is aggressively unloading its repossessed homes throughout the Metro Atlanta area. I believe this will add pressure on the other Georgia banks that continue to carry a lot of home inventory on their books. There are still great foreclosure deals in Buckhead and the North Metro area. I’ve been advising my clients to make aggressive offers, if the home is owned by a bank and has been on their books for a while.

Here is an excerpt from the AJC article on this subject:

Some smaller banks grumble, worrying that the property dumps by the big players causes housing prices to tumble even further.

“It’s definitely going to have an impact on those banks that do have toxic assets they are trying to get rid of,” said Carolyn Brown, president of the Community Bankers Association of Georgia. “They all are trying to get the best dollar they can obtain.”

Zombie Subdivisions

admin — Sun, 09 Aug 2009 03:00:53 +0000

As I’ve mentioned before, the outlying Atlanta suburbs have really been hit hard by the housing slowdown. The subdivisions that seemed to sprout-up overnight in Forsyth and Fayette county, are now being referred to as “zombie” subdivisions, where only a few homeowners sit among acres of vacant, bank-owned lots. Hopefully, the bankd won’t be changing any of the subdivision names to “Dawn of the Dead.”

While there might be small examples of the “zombie” phenomena in the immediate Atlanta suburbs, like Dunwoody and Sandy Springs, it’s more common in the fast-growth counties. Here is an excerpt from an article in the AJC on the huge volume of vacant subdivisions in metro Atlanta.

To say the market has been sluggish would be an understatement. The main problem is sheer volume – a staggering 150,000 vacant housing lots across metro Atlanta are available, more than a decade’s supply at current absorption rates.

The Perils of Short-Sales

admin — Wed, 05 Aug 2009 02:53:35 +0000

I’ve written about short-sales on this blog in the past. A short-sale can be a good alternative for all parties involved, but keep in mind, it can be a very frustrating experience. As a buyer, you are now negotiating with two (or more) parties; the homeowner and the lender(s).

The lenders can be very difficult to work with. During this unprecedented real estate market, the lenders are overworked and lack experience in short sales. Here is an excerpt from a recent USA Today article on the perils of short-sales.

But many short sales are faltering, largely because some lenders may lack the internal staffing, expertise and systems to process such sales in a timely fashion. And short sales can be complex, especially if they involve home-equity lines of credit or other second liens held by different lenders, who also must agree to take less than the amount they’re owed from a home’s sale.

Several lenders acknowledge that banks have been part of the problem, in part because most have done so few short sales in the past that they’ve faced a steep learning curve.

“About half of short sales never close. We see it as a big lost opportunity, and we need to improve the rate we close them,” says David Sunlin, vice president in charge of short sales at Bank of America.

Uncompleted short sales that go to foreclosure are costlier for lenders and homeowners. For lenders, a short sale may save as much as 30% of the expense incurred by going to foreclosure.

If you want a good deal, be prepared to act quickly

admin — Thu, 30 Jul 2009 18:47:46 +0000

I work with some investors looking for high-end homes in Buckhead. There are some really good deals on premium, builder spec homes in Buckhead. There are also come great foreclosure deals. Frankly it’s because in the current market, few investors can secure financing on upper-level homes, so buying competition has been reduced. Every once in a while I’ll see a home come on the market that I just know will go under contract quickly. I sent emails stating that both of the following properties were great deals early last week. This week they both went under contract. In fairness to my investors, the properties didn’t match their needs.

It shows that the market can still sense a good investment, and if you want a good deal, be prepared to act quickly.

This home is in Buckhead on East Pine Valley, the majority of the homes on this street are in the multi-million dollar range. It has a guest home and swimming pool. The home went into foreclosure a few months ago. We tried to contact the bank, without success, about buying it for our own residence. If we hadn’t already bought a foreclosure in Buckhead, I would have been first in the line making an offer on this home.

The second home is a foreclosed builder spec home in the Chastain Park section of Atlanta. I toured it last winter when it was priced at $950,000. It’s a beautiful home, but somebody let the pipes freeze and burst. So there were a lot of holes in the drywall. The home was also missing a kitchen. Due to the missing kitchen, it would not have been possible to get a traditional mortgage. I knew lack of financing options would tighten the number of available buyers and open the home up for a lowball offer. I encouraged a few clients I have been working with to make a lowball offer on this home, as once the repairs were made and a kitchen installed, the home would be worth more than $1 million. A couple of weeks ago, when the list price dropped to $725,000, I sent out another email to my interested buyers; I knew it was a steal. The home went under contract a week after I sent the email.

Let me know if you are interested in one of these homes, as the contract could fall apart, or some other property deals in Atlanta.

Short Sale Primer

admin — Wed, 24 Jun 2009 18:41:48 +0000

I’ve written about short sales fairly extensively on this blog and have actually dealt with short sales and foreclosures more than a lot of my colleagues in Buckhead, Sandy Springs and Dunwoody. I have worked with clients in Buckhead and Sandy Springs who have tried to buy pre-forecosure and REO properties. I’ve seen some very good deals on Buckhead luxury properties.

Although I’ve had some experience with short sales, the whole concept is still a fairly recent phenomenon that requires any Atlanta agent to continually search for more information. I found a great article by the NAR outlining the basics of short sales. Here is an excerpt:

The rapid increase in the number of short sales, and the short sales process itself present a number of challenges for REALTORS®. Major challenges include:

Limited experience

Many REALTORS® are new to the short sales process; a difficulty which is compounded by many lenders’ lack of sufficient and experienced staff to process short sales. Even if the REALTORS® are experienced, most servicers are under-staffed and still not adequately trained, making negotiating a short sale particularly difficult.

Absence of a uniform process and application

Currently, both short-sales documents and processes are lender-specific, making it very difficult and time-consuming for REALTORS® to become knowledgeable and efficient in facilitating these transactions.

Multiple lenders

When more than one lender is involved, the negotiations are much more difficult. Second lien holders often hold up the transaction to exert the largest possible payment, in exchange for releasing their lien, even though in foreclosure they will get nothing.

As a result of these challenges our members have reported difficulties with: unresponsive lenders; lost documents that require multiple submissions, inaccurate or unrealistic home value assessments, and long processing delays, which cause buyers to walk away.

If you would like to see the rest of this article by the NAR, please click here.

I also found a great short sale article at Las Vegas Short Sales.

The best foreclosure deals

admin — Tue, 23 Jun 2009 17:56:53 +0000

While there are many different ways to find great foreclosure deals in Atlanta, one of my favorite places to look are builder spec homes. When buying a foreclosure you still have to rely on the most basic adage in real estate: location. I would be hesitant to buy a home in a development that has a lot of foreclosures, as it will probably take a while to recover. The current market allows buyers to find deals in desirable locations, you just have to be patient, but be able to act quickly when the opportunity arises.

Of the high-end communities in Atlanta; Buckhead, Dunwoody and Sandy Springs have some great deals on “builder” homes. Keep in mind, whether the builder is in a short-sale scenario or the bank has already taken possession of the property as an REO, the negotiating process can be different from a traditional real estate deal. It can be a little nerve-wracking as there are inevitable delays and changes, but if you have the patience, there are come great values in the North Atlanta real estate marketplace.

I recently helped a client purchase a builder-owned, short sale property for 68% of their $2.5 million asking price. At times the negotiations were a little tense, but in the end, I feel confident my clients received a great deal. As a matter of fact, once the sale became public record, I had a number of my fellow Buckhead, luxury home agents comment on the low selling price and great value. I heard the comment, “If my clients knew it was going to sell for that price they would have made an offer on the property” from more than one Buckhead real estate agent.

If you’re interested in a short sale or foreclosure property, please feel free to contact me.

New Atlanta Home Search Software

Administrator — Mon, 22 Jun 2009 20:42:29 +0000

I’ve recently purchased, for this website, the most comprehensive and intuitive home search software in all of metro Atlanta. The last couple of weeks I’ve been integrating the features into this website. This premium home search software is triple the price of other agent software solutions. I’m making it available for free, without any registration requirements, to prospective Atlanta real estate buyers.

In short, it gives buyers interested in a Buckhead or North Atlanta home, the opportunity to see instant results on a map as they refine their searches. I’m still customizing and integrating, but for a “sneak peak”, take a look at the new Buckhead home search page.

If you find the software helpful to your home search, please consider contacting me when you would like to view the properties. Once you’ve had an opportunity to try the new search features, I would be very interested in your comments and feedback.

The one sided real estate contract – buying an REO

admin — Sun, 03 May 2009 20:07:06 +0000

I’ve been blogging about my personal experience in buying a Buckhead foreclosure here in Atlanta, Georgia. There is so much to write about, it’s hard to know where to begin.

When we finally went under contract on a bank-owned foreclosure, it was just the beginning of our journey into the depths of anxiety. The bank stated that our offer had been accepted, but we were not under contract, and then faxed us a 25 page addendum, that was five times as large as our original contract. It’s the most one-sided thing I ever read in my life (other than the other bank-owned real estate transactions I have worked on). Their addendum could have been much smaller with one simple sentence, “Absolutely anything we say goes, which is, but not limited to your name, your place of birth, the planet you live on, and what you believe to be reality.”

When you get the addendum, you have to sit down, breath very easily and know that any change you request to their boiler plate language will mean an army of bureaucrats could take weeks to approve it. These are weeks the house will continue to stay on the market, potentially being exposed to higher offers than your current pretend contract’s offer. You’re balancing some fairly outrageous clauses versus the fact that you have a contract on a home for a very good bargain. Ultimately, the only language we struck was a clause that would have fined us $600 for every day our closing needed to be extended, whether it was our fault or theirs. If I’m spending $600 a day for something it better be called Greenbrier or the Cloister. The bank allowed us to reduce the clause to $100 in a fairly quick manner.

We left a lot of other one-sided clauses, such as giving the bank the right to rescind the offer for any reason. You simply can’t go through their boilerplate language, and change it word-for-word. You have to take a leap of faith and remember the bank ultimately wants to remove the house from its books.

It does leave you anxious, knowing the bank can cancel the contract, yet you’re bound to it. You cross your fingers, while holding your pretend contract, as the closing gets pushed back for a variety of reasons, praying for the day you actually own the home. I’ll write a little more about the trials and tribulations of getting to closing in a few more days. At one point, we had dropped our checks off, but still didn’t really own the Buckhead home.

Just bought a Buckhead foreclosure

admin — Tue, 28 Apr 2009 23:23:05 +0000

I’ve written a lot on this blog about all of the great Buckhead real estate deals, especially the foreclosures and short-sales. Not only do I work with buyers in finding Atlanta GA real estate value, but I also recently became a foreclosure buyer. So when I tell my clients to have a lot of patience, and I mean lots of patience, when working with bank foreclosures, it comes with empathy.

Negotiating real estate can be difficult, because of the highly personal nature of home ownership. Many owners view their homes, at least on a subconscious level, as a testament to their style and taste. Naturally, it can be nerve-wracking as potential buyers come through a home and offer feedback, through their agents, on their likes and dislikes. Then, of course, the almighty offer quantifies the emotion and anxiety into a single number.

Foreclosures are the exact opposite. It’s completely impersonal. More than likely the owner / bank, hasn’t stepped foot in the state of Georgia, much less the home. Add the unprecedented level of foreclosures, which has overwhelmed the REO departments, and instead of getting emotion from the seller; you’ll get what seems like indifference.

We made an offer on our new home and didn’t hear back for over two months. To be honest, we had basically given up and were shocked when the listing agent called and said our offer was accepted. The listing agent will know very little about the inner workings of the bank they are representing and will be unable to give you much feedback on your offer. Keep in mind, the mega-bank probably has thousands of foreclosures and simply doesn’t have time to update individual agents on offer statuses.

We later learned getting the offer accepted was only the beginning. I’ll save the rest for another post, but it was a stressful experience. I believe we got a very good deal, but it’s not without hard work.

Here is a picture of the home:

We have some work ahead of us, but it’s in a great location and the previous owners added a lot of upgrades. We’ve decided to embrace the French look, and are going to try to give the mansard roof more character. My immediate thoughts are to add a “flair-out” at the bottom of the roof so it won’t be quite as boxy.

I’d like to make it more like this roof:
I really like the slate and the curve, but also have to be reasonable about the costs. I have a tendency to go overboard with upgrades, which can be disproportionate to the overall value of the home. If anyone has ideas, I would like to hear them. Here is another picture of an Atlanta home with a mansard roof and shake shingles. At a minimum, the mansard roofs with character seem to “flair-out” at the bottom. I’ll probably post about efforts to add curb appeal on this blog.

There is a lot of Metro Atlanta real estate for sale, due to the downturn in the housing market. If you would like to look for some properties, please feel free to contact me, I’d love to hear from you.