Elise Vetri

Free money is something no one wants to turn down. And with this perfect combination of low prices, lower interest rates, and now the tax credit, buyers are out in droves. Perhaps you have bid against them for the same property. There is something very important to consider as we draw nearer to the deadline of November 30.

What! Near the deadline! I still have a few months to find a house!

No, not really. Many buyers and their agents are not taking into consideration a few very important factors. I feel the truth is better than the harsh reality of missing the boat. So her it is.

1. FHA appraisals. If you are going to go with a FHA loan (3.5% deposit), that once you find that dream home and are "under agreement," the house will need to be appraised by a FHA appraiser. Back in the day where every loan was a FHA, the typical closing period was 4 months. Whlie we are not seeing this yet, there is a backlog occurring in the system as we speak. Appraisals are taking weeks to get reviewed by the underwriting staff which means moving forward as we approach the deadline and everybody wants to close by Nov 30, the backlog will continue to increase along. This means it could potentially take 2 months at least to reach the closing table from contract signing.

2. Not every house is a foreclosure. We are seeing an abundance of short sales and of course, owner occupied homes. What is the seller needs to fins a place before he can close in his. Or what if the short sale takes months to get approved by the bank. These factors could knock you out of the Nov 30 deadline to close and qualify for the 8000.00 Tax Credit.

Now, will the tax credit deadline get increased. That is a possibility but do you want to take that chance?

The best solution and what I am advisign my clients is to be in contract on a property NO later than Sept 15. Anything beyond that for a FHA, rehab, or USDA loan is way too close for comfort and a guarantee to close on Nov. 30.

 If a sellers agent asks for you to wait for the sellers to find a house, you should give them until the end of August to close in the event things don't go smoothly such as inspections on both houses, appraisals, and mortgage contingencies. There are too many pieces of the puzzle that have to fit perectly in this time frame to cut it too close.

If it is a short sale you are after, have your agent ask some very poignant questions about the lien holder, whether it is approved, who is handling the short sale and how experienced are they, and be sure to give a firm deadline to close.

 Elise Vetri is considered an expert in Buyers Representation with Keller Williams Realty No RI, Lincoln, RI

She can be reached at 401-766-0128 or elise@elisevetri.com

About 75% of the propeties being sold in Northern RI are foreclosures. Why? It is the perfect opportunity for buyers giving them the affordabilty that has been lacking in this market.
Sometimes they are in great condition and sometimes they are not. But there are loans programs available that give you the money you need to rehab the house.It is called a 203K
and are a great way to affordably make the repairs needed such as roofs, heating systems, and even kitchen appliances. All you need is a reputable lender to help you meander through
this type of program. To get into the house with no down payment, there is a very popular program that will let you borrow 100% Loan to Value, NO PMI, NO prepayment penalty.
You may purchase a 1-2 family and it must be in a targteted area. There is a website that enables the buyer to check on a house they like to see if it is in the targeted rural area.
You amy request the details of this program and a link to the website by emailing elise@elisevetri.com

 Buying a foreclosure is alot easier than it used to be and many times you are walking into instant equity. No one know if we are at a bottom in prices but almost everyone agrees that if we
are not there, we are close. You can get into a foreclosure for 50,000-100,000 off the city's/town's assessment. Attached is a complete report on how to buy a foreclosure and where to find them.

You will find it quite helpful.

 So often I am asked by buyers about foreclosure properties and how to buy them at Auction. My answer to this is you never want to buy a home at an auction if you don't have to. I will come back to this point in a minute.  

There was a time when the only way to get an extraordinary deal on a foreclosure property is at a Bank Auction. But these days are quite different. There are so many foreclosures that the banks will never be able to sell them all if they relied on just the auction process which is why the banks are listing these properties with Real Estate Agents. That means that you can purchase the property with the necessary contingencies in place that protect you , the buyer from any unknowns and from taking on any financial risk.

The difference is this. At auction, you must have a bank check of $5000-$10,000 to put down as a deposit.You are not able to preview the property and inpsect for deficiencies that my cost a bundle to fix. And if you do not proceeed with the purchase, you are in default and lose your deposit. Lastly, many of these properties have inherited unpaid taxes known as encumbrances that the new owner must pay. So there is a great deal of financial risk. That is why, the only good candidate for a purchase at auciton is a cash buyer with deep pockets and the ability to assume the risk. If this does not scare you, this might.

Owners who have lost these homes to foreclosure are not happy people. Rightfully so. But they take out their frustrations on the house by extensively damaging the plumbing, heating system, removing pipes and sometimes entire kitchen. Issues you can't always see by peeking through the windows.

Instead, what you will want to do is enlist the help of a qualified, experienceed, full time Realtor. This agent will represent you by submitting your offer to the bank and yes, you can "lowball." In fact, I recommend it. They can always come back with a counter offer which may be much lower than you think. Once accepted and under agreement, than you can inspect the property with a home inspector to look for any of these damages that may cost a bundle to repair. And while contract laws vary from state to state, the essence is, you are protected by the terms of the agreement should you not want to go through with the purchase or if you were unable to obtain the necessary financing. Your Realtor will guide you through this process. The good news is, you do not have to take on unnecessary risk in buying a foreclosed property to get a good deal. Banks are willing to negotiate. Just don't expect the bank to make any repairs as these properties are being sold in "As Is' condition most of the time. You can always ask and see what happens, but don't go in with this expectation.

Elise Vetri is a RI based Realtor that specializes in foreclosure buyer representation in Northern Rhose Island.

www.elisevetri.com

Harrisville, Burrillville  -  Announcing a price reduction on 151 Hill Road, Burrillville, a 1,326 sq. ft., 2 bath, 3 bdrm 2 story. Now MLS® #750264   $225,000 - Best Burrillville Value.

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