Charleston SC Foreclosures
Foreclosures in Charleston, SC are popping up all over the area. There are some terrific bank owned properties to take advantage of right now in a buyers market. Banks seem to be listing these properties at 85% of market value, to move them. They make for an easy transaction (no waiting times like short sales) and the banks can close quickly if need be. Make sure you do your homework on your potential foreclosure sale! Banks are selling these foreclosures in "as-is" condition, meaning they more than likely have no knowledge to the condition of the property, and make no warranties or guarantees to the condition.
Make sure you read this below on the best strategies for making an offer on a foreclosed bank-owned home!
No matter what price range, Charleston foreclosures are seen by many as a perfect way to get into a great neighborhood, at an affordable price. Take advantage of this market!
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Things to Know When Making an Offer on a Bank-Owned Home
Again, like mentioned above, the banks typically put a foreclosed home on the market at or near 85-90% of market value to get them off of their books. They are not in the business of selling real estate, so they want that property sold quickly. When the property first comes on the market- they will not be interested in negotiating much, and they certainly won't be accepting any "lowball" offers, being new on the market. Yes, that means that if the bank-owned foreclosure has only been on the market for a few days and its list price is $250K, you will not be that one exception in Charleston that secures the property for $150K. When the house is new on the market- the banks typically stick to their list price because initially there is a good deal of interest (remember- they initially put the home on the market at 85-90% of market value). The key thing to remember is- the longer the foreclosed home sits on the market, the more the banks will be willing to negotiate.
A lot of times, when a foreclosed home in Charleston is new on the market, there are multiple offers that have been submitted. Frequently foreclosures sell for list price, and cash is always king. So even if you are at a higher asking price than another buyer- if you are financing and the other buyer is paying cash- the bank will take the cash offer all day long. Remember to have your Charleston realtor ask if there have been any other offers submitted, and if any of the other offers are cash. The reason the banks will consider the cash offer at a lower asking price is that the transaction is less likely to fall-through due to buyer financing. Keep in mind that no matter what kind of killer deal you heard someone else getting, the banks don't give the farm away. Trust me, The Asset Management Company the bank hires will negotiate on the bank’s behalf, just fine.
Negotiating Repairs With the Banks on a Foreclosed Home
Foreclosed homes in Charleston are likely to have been vacant for some time. This means no power to the house to keep the moisture out of the house or crawl space, no one to clean the house, and it is possible that squirrels, cats, or other rodents have made this house a home. Be prepared to put in some time, effort, and money when considering a foreclosure. Another thing to take into account is that the home will be sold in “as-is” condition. This usually means that the bank will make no repairs. The banks have not lived in this home and therefore have no knowledge to the condition of this house. It is up to you, the buyer, to perform all home inspections to determine if this home is the one for you. If you find deficiencies in the home, it is up to you (or your Charleston realtor) to find a suitable contractor to get estimates on what it would cost to make repairs. **Keep in mind that if you are financing this foreclosure purchase- your lender will not want to see any structural deficiencies with the home, nor they may not want to see any plumbing issues, electrical issues, or any other borderline major issues with the house. Lenders have continually gotten much stricter on their financing guidelines, and won’t lend to you if they feel the house has major issues. Your lender will also want to see a clear CL100 when providing financing for the home purchase as well.
So what is the plan when you find these deficiencies in the home? In the not-so-distant past, you would make the determination on whether this is still a sound investment for you, and have the repairs made at your expense. However, lately we are seeing banks finally negotiating on some of the necessary repairs, with them actually agreeing to make repairs (at their expense) to certain items. Make sure that your realtor is aware of this and that they will negotiate this for you with the bank.
This is just the beginning, as there are many, many other circumstances to take into account. Have your realtor in Charleston go over your game plan BEFORE submitting any offer.
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