Misconceptions of buying Orlando Foreclosure
In fact buying a Foreclosure in Orlando may be different from the foreclosure market in another state. By saying Orlando Foreclosure, I am speaking about Central Florida and not only the city of Orlando.
First of all what is a foreclosure?
A foreclosure is a home where the previous owner got behind on mortgage payment and the bank took the property back in a foreclosure sale. It is like a car being re-posessed for non-payment. The bank is now the owner.
As a buyer agency real estate office, that works in the State of Florida, where there are a lot of foreclosures, we have become experts on the nuances of buying an Orlando Foreclosure. We find Orlando Foreclosures, show them, analyze them and make offers. We understand the Orlando foreclosure market.
BIG Misconceptions about Orlando foreclosure:
1. Misconception: A Orlando foreclosure is always a good deal.
Maybe, maybe not. Banks are not giving away anything these days. Banks with an Orlando foreclosure are looking to get top dollar with terms that are favorable only to them. Many homebuyers today assume that bank foreclosures are priced low. Value needs to be determined by a smart buyers agent. You need to selectively pick the best.
2. Misconception: The bank only wants what was previously owed.
What was owed is irrelevant and the bank erases all debt and starts over. The bank will now want market value and maybe even more than market value. There are many home buyers out there who think just because the bank is now selling the property it will be a discounted price. If the property is listed below market value, there is usually a reason…the true condition of the property.
3. Misconception: What you see is what you get.
What you see you actually may not get. Banks will not include any appliances, sheds, auto door openers, window treatments, or additional features in the contract. That way, if something goes missing, bank will not be responsible… that means if the copper wiring is missing, the pool heater has been stolen it pretty much becomes your problem. Sure you can refuse to close and the bank may or may not accommodate you. It then becomes a sticky situation. Yes I agree that there were light fixtures when you made the offer and you did not buy a home without light fixtures, but the bank may not see it that way.
Yes they should … if you are not buying a Orlando Foreclosure. Bank foreclosures are handled differently.
The bank may require you to turn on the utilities for inspections, or they may not allow any utilities to be turned on. You cannot do a proper inspection without water and electric.
That means if you want the property you will have to gamble that the electric actually works and the plumbing has not had concrete poured in it.
Sometimes owners blame the bank for losing their home so they destroy what they can. Vandalism is also common in a Orlando foreclosure.
Keep in mind that lenders do not like to lend mortgage money on a distressed property unless buyer is asking for a re-hab loan.
5. Misconception: The purchase contract with bank will protect you.
In a regular contract with a traditional sale, where there is a real seller the contract will mean something. In that case there is a contractual responsibility for both sides built into the contract .
With a Orlando Foreclosure you are not dealing with a real person, or even a face. A Orlando Foreclosure means you are dealing with an institution that plays by their own rules.
First you go to contract with the bank under the terms agreed to and after you sign, the bank will send you a 30 page addendum that changes terms and erases any protection that you may have had under the original contract. It is one-sided for the bank with no protection for you. None at all. It is the banks way or the highway. If there is a problem, there is no one that you can actually speak to.
Don’t count on the listing agent to help either, as they may have hundreds of listings that they have never seen and you are number 56 on their “to-do” list.
Bank foreclosure are not necessarily a bad deal if you know exactly what the problems are and still think the price is acceptable. Most foreclosures are distressed to some extent. The luxury Orlando foreclosure properties tend to be in better condition and could even be in great shape as the banks sometimes do fix those up.
The key is to work with an experienced buyers agent who will look out for your best interest. That means you need to buy the Orlando foreclosure with your eyes open and a seasoned buyers agent that reads the small print. Call us 407-539-1053