Beware The Queen Of Blight When Investing In Foreclosures!
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May 31, 2013
June 5-6, 2013
Ha… That happened to me in Minneapolis. Bought a house that hasn’t seen paint in 30-years, and before I could get a paint brush out, they were sending me nasty fix the house up letters…
I deal in Apartment Buildings For Sale and I just see this as an opportunity. If you are buying a property for investment, the best way to get a deal is to show the seller why they should take your price and avoid offending them. If the property has lots of damage, liens, and city violations, the bank is more motivated, there are less buyers interested, and the investor gets a better price.
Blight Problem. The city of Riverside is another that plays this game with “code violations”. They have a web site that you can look up to see if there are any however the information is not accurate. I had a recent one that according to the web site owed less than $2,000 the demand was about $18,000. Sure if it goes back to the bank because investors shy away the big bad banks are stuck with the bill. But isn’t the idea to clean up the neighborhoods? Reality is a revinue source for the city, nothing more. If it goes back to the bank it stays ugly for longer than if an investor buys.
Guys, I appreciate the desire to create content, but I gotta ask, do you or have you ever done a fixer/rental? Your missing the mark again………
If the bank forecloses on the house, follow the freakin’ law and same goes to the cities across this country, get off your butts and put the fine hammer down on the banks NOW. Nothing worse than a bunch of dumps all over the place to wreck those that put the time in to make the payment, and keep the house in proper condition too. Everyone has a responsibility to each other in real estate, no free lunches!
And if an investor buys a house, then get to it, fix it quickly, then the fiines stop. At least in Portland, Oregon, code fines are not significant and you can even go into the city and work em down a bit too.
I bet in most cities across the country, the fines are also not significant relative to the price and margin potential of the deal. So quit sniveling about it, and just get on with it.
Or we let the banks do nothing on their REO’s, and the city/county gubments, you all sit around too and do nothing. See how that plays out. Oh, that is what we are doing now, great plan………….
Frank & Brian,
Can Realtor’s go to originator fest?
the comment in nw indiana just reinforces my belief in that not all the crooks are behind the bars…being on a local government board was an eye opener as to what goes on with the politial machine…regarding loss of agents in the business i say great the cream always rises to the top , last year i was told 40% of the agents had NO real estate transactions, i say lets make it harder for anyone to get a license and weed out the agents that typically make my job a nightmare !! signed an agent of 31 years whom has a low tolerance for incompetence…….
Brian,
You said because of banks failure to foreclose on properties.
Shouldn’t you have said,
“A failure to modify, rather than foreclose” ???
Jen Quinn / Realtor
Those left behind get more market share of WHAT?!
My market is primarily foreclosures. I have experienced a community in my area set a home for demolition without proper notification to the lender. It was only when the demolition bill had to be paid by someone that the city decided to finaly give notice. This lender is loosing that asset to demolition by their own hired company. Keep in mind, the property was good enough for their NSP program (neighborhood stabilization program) at a much reduced price but not good enough for me the realtor to sell to an investor or new homeowner. After doing a little bit of research, I have been advised that this behavior and placing large liens on title on vacant bank owned properties has become a habit with this city. Seniors are also a target. The city decides to cut the grass, lien the property for all their hard expensive work, attach HUGE daily fines and the next thing the senior knows the property is worthless and they have no other option but to turn title over to the city, only then will the homeowner get out from under all the threats and intimidation. The property is then rehabbed by the City using HUD funds and then placed on the market for sale. Some of the properties will also end up as an investment property for the powers that be. The Queen of Blight does not hold a candle to what is being done in this NW Indiana community.
Wow – it just keeps getting more and more ugly. Greed, pure and simple, is what got us here and there seems to be no end to it. I have lost hope in our system and finally don’t see how we can get out.
Too funny yea you can stay if you like. I think what you truly like is the lack of business so you can be lazy. Lets face it even if you took the ground you would probably work 4 hours in a day for 3 or 4 days a week. If you loose the premadonna attitude and work 65 hours a week you may get a deal , but think about this the worse is yet to come and real estate sales will never get back to what they had been. the word bubble means got way out of hand and over inflated , towns that had 1000 deals a year will now have less then 300 a year . Hang in there while the smart move on to make real money doing something else !
Yes…..the ones that are left behind are the better agents…the survival of the fittest!
Too funny that term is used for reproduction and popultion growth , nothing to do with smart people getting into a better field then real estate or leaving a dying industry . What is left being a buyers agent trying to sell foreclosures in a state that is falling off the map ? Oh boy , did you go to college ?
Unfortunately, there seems to be a lot of legislation on state and local levels which does little more than further discourage prospective buyers. A good example of this is something I encountered recently. Effective Jan 2001 in IL. it is now required that the buyers of bank owned condos are responsible for the “common expenses” incurred by the lender for the six months prior to the foreclosure sale. By common expenses, they’re not only referring to back due association fees but also attorney’s fees, etc. While they are required to disclose these fees through the 22.1 disclosure, they have 30 days to provide the disclosure to the buyer.
( I wonder if the bank lobbyists had anything to do with this) On a recent transaction of mine, the seller was expecting the buyer to pay almost $3,000 worth of THEIR expenses- $900 worth of association fees and over $2,000 in attorney’s fees ( trying to collect the $900) We found out about these charges a week prior to closing. Fortunately we were able to get the seller to pay their own legal fees or the deal would have died. Seems really crazy to come up with new legislation that further puts the brakes on the market!
Oops, I meant Jan 2011. The amendment to the Il condo homeowners act is what I was referring to
you guys are fantastic! I LEARN something everytime I watch you, thanks for the great show, I am in northern (up) michigan
Great point about the current market opportunity. As folks leave the housing insustry those of us committed to it CAN pick up market share. I say can becuase we have to go take the ground given up, it won’t come to us for just staying in the Biz.
What is turning out to be a bigger problem in some of these neighborhoods is getting the appraised values up to match what buyers will pay for properties. Appraisers are using Realtors comments to determine the condition of comparable sales. The listings agents are not disclosing all of the issues with some of these properties in the comments, so the appraisers are really not make the correct adjustments which is bringing down values.
Getting the incorrect information is not the Appraisers fault its the Realtors for not telling the truth when asked a direct question. Incidentally we dont have a choice, if we dont call the Realtor and document the conversation we get nailed by the State Licensing board. If we do call the Realtor to get information that turns out to be incorrect the borrowers agent complains about the incorrect adjustments. Why dont you stand up in the Realtors meetings held in your area and explain to other Realtors to tell the full truth that way the Appraisers will get the correct information to satisfy the State board and be able to do a credible job for the bank and borrower. As an aside, the Realtors’ mis-information in the Appraisal report doesnt absolve the appraiser, it may help when they get dragged in front of the disciplinary board after a complaint is lodged, but if and when there is a foreclosure, the bank WILL come back to the appraiser for E&O reimbursement due to that misinformation.
Local government is becoming just as bad as federal government. Our local city council is proposing a search warrant policy for zoning violations (occupancy limit violations and/or home based business violations), yet one of the city council members in favor of the proposal violates one of the zoning statutes by working from home without a city permit.