Distressed Properties

Foreclosures:

Foreclosures in Colorado are homes or condos that the current owner is behind on his or her payments.  In Colorado the time when the home is technically in “foreclosure” is when the lender has filed the NED, or the Notice of Election and Demand.  This is prepared by the attorney for the bank and they send paperwork to the Public Trustee of the county where the home is located. 

There are state statutes detailing the time line of the foreclosure, from the start to the finish.  This can vary depending on whether the property is agriculture or a normal lot and block description.  If your home is in foreclosure, you do not have to move out until the bank owns the home, which can be several months.  Keep in mind if you are in foreclosure you will receive plenty of notices, mailings, phone calls from people mostly interested in your “equity”  Some are honest, but most have a hook.  Call me at 303-888-2488 to discuss your situation, as I have no interest in purchasing your equity, but only in advising on your real estate situation.  Just email me at mcgmhg@earthlink.net with your questions.

Investments, Bank Owned, and REOs:

So now you want to buy a property that has been foreclosed on and is now owned by the bank, the FDIC, HUD, VA, or any other financial institution.  Here are some things to think about, before purchasing distressed properties.

  • Just because it is an REO, does not mean it is a good value.
  • The property will be sold in its AS IS condition.
  • Does the bank have clear Title?
  • The bank will have its addendums, several pages, that limit you and protects them completely.
  • You need to do a thorough inspection of the home, inside and out.
  • What is the history of the home?
  • What was the home used for prior?
  • If it is currently vacant, how long has it been vacant?
  • The banks do not work on limited 24 hour time frames, it may take weeks for answers, and closings may be delayed for signatures.
  • The property will sell for market value, they have appraisals and BPO’s to support their asking price.
  • REO’s do not sell for pennies on the dollar, as some late night guru’s may lead you to believe.
  • Is your financing in place, once an offer is accepted, the bank is planning on selling to you at the agreed upon terms, they do not like extensions.
  • The condition and items in the home, may not be there when you close.  Sorry, copper pipes have a knack of leaving the home, as do movable appliances.

Each property is different and always needs extensive research.  Email me at mcgmhg@earthlink.net or call 303-888-2488 to discuss your plans.

Short Sale Selling Information:

One thing that can be said about short sales is that it will be anything but short in time frame.  The lenders will want to know everything about your reason that they should take less than is owed on the loan.  As an expert in selling short sales, and foreclosures we have the expertise to help you.

  • The home has to be listed with an agent, and on the market.
  • There needs to be a hardship letter of why you can not pay your loan in full.
  • You need to provide tax returns.
  • You need to provide bank statements.
  • You need to be patient.

If there are more than one lender involved, these steps outlined above need to be addressed for all lenders. You will have to provide these to the lender, wait for them to receive, then probably resend them again, because they never made the file. There may be a “investor” who will have to be notified, and this will mean at least 2 more months, after the current lender gives their blessing. Once all the lenders give their written approval, you will need to close, with the new buyer, within 7-10 business days. Call me at 303-888-2488 for details and how your situation applies, or email me at mcgmhg@earthlink.net.

Here is a Link to the MLS of Bank Owned Properties: