Costa Mesa's Neighborhood Blog

A blog about Newport and Costa Mesa with an emphasis on Costa Mesa Real Estate and Newport Beach Real Estate, written by a lifetime local resident of coastal Orange County whose knowledge of the area, combined with a strong background in mortgages, real estate and being an attorney, gives her clients many advantages.

Should You Try to Buy a Huntington Beach Foreclosure?

Should You Try to Buy a Huntington Beach Foreclosure?

Perhaps you have heard that the best deal is a foreclosure, also known as an REO or a bank owned home.

What are the odds of getting a foreclosure? Looking at April's home sales in Huntington Beach, there were only 15 bank owned homes. This means that of all of the homes that sold in Huntington Beach, only 11% of them were REOs. The result is often fierce competition. Because many people believe these are the best deals, there are often numerous offers made on foreclosures in the first few days after they come on the market.

bank repo

Because the competition is so fierce, you may want to consider other options when deciding to purchase a home. Short sales may also offer a good deal. They can be more frustrating as they are depending upon the bank agreeing to accept less upon the sale of the home, and it can take months to learn if the bank will even accept the offer. However, in April, 19% of the homes that sold in Huntington Beach were short sales, which gives you almost double the chance of buying a short sale if you would like to buy a "distressed home".

A third option is to consider the equity or standard sale. This is a home being sold by a seller who is neither a bank nor upside down in the value of their property. Sometimes these may be a better deal than a foreclosure or a short sale for a number of reasons.

Perhaps the home is in better condition than an REO. Perhaps you would like to have the certainty of knowing the price you will pay when you have an accepted offer, unlike with a short sale. Perhaps you would like to close quickly and your situation doesn't allow you to wait months to find out if you truly have a deal.

So, should you try to buy a Huntington Beach foreclosure? That depends upon your situation and your goals. And, if you are finding that your offers on REOs are being rejected, consider making offers on short sales and/or standard sales.

If you would like to discuss your needs and goals so that you can craft a plan to purchase your next home, please contact Christine Donovan at 714-319-9751.

Originally published at www.donovanblatt.com

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About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.

Are you upside down in your home? Is it worth less than you owe? Are you concerned about making your mortgage payment? For more information see Options to Foreclosures, understanding short sales or contact me at christine@donovanblatt.com to discuss your options.

If you want to buy a home or to list your property for sale, please click Newport Beach homes, Costa Mesa homes, Huntington Beach homes or Orange County homes.  Click the link if you are interested in buying a home at a courthouse auction sale.

Contact me at christine@donovanblatt.com or 714-319-9751 to learn about her system which will make your buying and selling experience easier.

Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.

Federal Government Disclaimer (MARS) 

  1. You may stop doing business with us at any time. You may accept or reject the offer of mortgage assistance we obtain from your lender [or servicer]. If you reject or accept the offer, you do not have to pay us.  
  2. Christine Donovan, DonovanBlatt and Donovan Group are not associated with the government, and our service is not approved by the government or your lender; and 
  3. Even if you accept this offer and use our service, your lender may not agree to change your loan.

Click Orange County homes for sale to view all OC homes for sale.

0 comments • Christine Donovan Costa Mesa CA Homes Broker/Attorney 800-610-7253 DRE01267479 • May 02 2010 02:43PM

Purchasing an Orange County Foreclosure - How Does a Foreclosure Work?

Purchasing an Orange County Foreclosure - How Does a Foreclosure Work?

 

Have you been considering purchasing a bank owned foreclosure in Orange County?  If you have, then it's important to understand how this type of purchase differes from a traditional, equity sale.

How does a bank foreclose?

REO is another name for a forelosure, and it is a result of the bank/lender taking a property back after a borrower stops making payments on the mortgage.

California allows for two types of foreclosures - judicial and non-judicial.  A juducial foreclosure requires the filing of a lawsuit.  However, most foreclosures in California are done by non-judicial foreclosure, meaning that a lawsuit is not filed.  Instead, a Notice of Default is filed and then 90 days later, a Notice of Trustee Sale is given, and then the house is put up for auction.  If nobody meets the minimum bid, the bank takes the property back and it becomes an REO, Real Estate Owned.

Eventually, the REO is put back on the market.

Is a foreclosure a good deal?

Typically, the banks price the REOs to sell quickly.  Because of this and the perception that foreclosures are a great deal, there is typically a great deal of competition for these homes and numerous offers are the norm.

How do you get your offer on a foreclosure accepted?

If you are fortunate, you may be one of the hopeful buyers who are offered a counter offer.  Often, several other potential buyers will receive a counter offer at the same time.  At this time, you will be asked to make your highest and best offer.  The bank will then make a decision and choose a buyer.

The bank's decision on which offer to accept on the foreclosure may be based on several different factors in addition to purchase price, including: the down payment, the earnest money deposit and other terms in the purchase offer such as the number of days that the buyer has before contingencies to purchase the home are removed.

To give your offer the best chance of being accepted by making it the most competitive, consider putting down a larger amount earnest money deposit and offer to remove contingencies in a short period of time, such as 5 days, but make sure that you can get your inspections done during the contingency period.

Once the bank chooses the buyer, the buyer will need to sign several addendums, which are favorable to the bank.  They usually give the bank the ability to back out of the purchase at any time until closing, for whatever reason.

Another aspect of buying a foreclosure that you should be aware of is that banks do not usually make repairs on the property.  Still, it is very important that you take the opportunity to do inspections on a foreclosure prior to the removal of contingencies.  As the fact that you are buying a property as is, does not mean that you may not back out if there are more issues in the house than you realized.  For more information on this, see buying a house as is.  This is especially important as the bank does not have the same obligation, nor knowledge, to give full disclosures on the conditon of the property as a typical seller would.

 

As Is Costa Mesa Foreclosure

 

Should you buy a foreclosure?

When deciding whether or not to purchase a foreclosure, be aware that many of them may be in disrepair.  Sometimes, the previous owner has removed fixtures such as lights, appliances and toilets.  The previous owner may not have done maintenance as they moved towards foreclosure, not wanting or not having the money to do the necessary work.  The property may have been abandoned.  All of this can lead to a state of disrepair.  You may find a foreclosure in good condition; however, many are in a rough state.

If you are fortunate enough to have your offer accepted on a foreclosure, you may get a great deal, but in determining how good a deal it really is, consider the amount needed for repairs and make sure competition hasn't caused you to over bid the price.

If you would like to discuss if buying a foreclosure is the best option for you, please contact me at 714.319.9751 for a free consultation.

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About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.

Are you upside down in your home? Is it worth less than you owe? Are you concerned about making your mortgage payment? For more information see Options to Foreclosures, understanding short sales or contact me at christine@donovanblatt.com to discuss your options.

If you want to buy a home or to list your property for sale, please click Newport Beach homes, Costa Mesa homes, Huntington Beach homes or Orange County homes.  Click the link if you are interested in buying a home at a courthouse auction sale.

Contact me at christine@donovanblatt.com or 714-319-9751 to learn about her system which will make your buying and selling experience easier.

Disclaimer: All information in this blog is deemed reliable but is subject to change at any time and is not guaranteed to be accurate nor are there any warantees either express or implied. This blog is not intended to offer any legal, tax or other advice.

Federal Government Disclaimer (MARS) 

  1. You may stop doing business with us at any time. You may accept or reject the offer of mortgage assistance we obtain from your lender [or servicer]. If you reject or accept the offer, you do not have to pay us.  
  2. Christine Donovan, DonovanBlatt and Donovan Group are not associated with the government, and our service is not approved by the government or your lender; and 
  3. Even if you accept this offer and use our service, your lender may not agree to change your loan.

Click Orange County homes for sale to view all OC homes for sale.

4 comments • Christine Donovan Costa Mesa CA Homes Broker/Attorney 800-610-7253 DRE01267479 • February 19 2010 12:30AM