Put yourself in the situation of a bank / lender. You have a piece of property in the City of Buffalo. It was purchased in 1991 for $39,900. You have a mortgage note of $57,378 on it and have foreclosed. The property has a present value of $12,000. If this wasn’t backed by HUD, making the lender whole, would you want to take this in?
The ratio of the property value to the mortgage obtained on the property is not unique to this home. I picked this at random and it was the first property that I selected to run the numbers. The numbers are very typical of inner city properties. This one is a bit unique since the home was purchased more than 15 years ago. You will find many more instances where the property was purchased within the past 5-7 years.
In this case, the note is $57,378. “How did it get that high?”, you might ask. Lenders were all too willing to lend when money was easy. The banks and mortgage companies were marketing heavily and appraisal companies would generally comply with the “value” a property needed to reach in order to justify the loan. How much business do you think a lender would send your way if you appraisals didn’t justify their valuations? If valuations weren’t justified, money wasn’t lent. If money wasn’t lent, fees weren’t earned. Get it?
The New York Times just did a story regarding situations where the banks are giving up on properties. It is a tough market and economy.
http://www.nytimes.com/2009/03/30/us/30walkaway.html?_r=2&pagewanted=1&ref=business
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Administrator Exterior Projects bank, foreclosure, hud, lender
If you are really after foreclosures, or want to pay enough attention to the Buffalo area foreclosure market to be in the know when it comes to pricing, you should consider a subscription to RealtyTrac. You will find plenty of foreclosure listing sites online. Most are pulling from similar sources. What is nice about RealtyTrac is that they list pre-foreclosure listings. These are listings that aren’t yet bank owned and might be in line for a distressed sale. Don’t consider yourself a vulture in these situations. The person who is forced into a distressed sale just might be please that you reached out. Imagine if your 2 options were to give your house back to the bank (voluntary foreclosure) or to accept an at the money offer from someone looking to enter the real estate market on the cheap.
You can do a 7 day free trial here:
Start searching for your next home today with RealtyTrac and save money. Start now!
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Administrator Real Estate foreclosure, listings, pre-forclosure, reo
Our blurb regarding foreclosures in NY that was published yesterday turned out to be rather popular.
If you are in New York, and looking for a foreclosure, you might want to look to a bank owned property (REO) rather than something from HUD. When buying from a bank, you will have the opportunity to make an offer and negotiate from that. HUD is an offer/acceptance. You won’t receive a counter offer form HUD.
There used to be a lot of bank sites that listed properties for sale. However, the banking industry has changed quite a bit. Collapse and consolidation due to the housing market has altered the sites showing available listings a bit. One of the sites that offers listings of REO properties (more than just 1 bank) is Ocwen financial.
Visit Ocwen Financial. THis is a direct link to the Ocwen NY listing page. You should be able to navigate the site beyond that to find properties in other states.
Good luck with your foreclosure search.
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Administrator Real Estate foreclosure, hud, ocwen financial, reo