[Azzurri]

Any body have any experience in purchasing or making a offer on a foreclosed home in Michigan. I was looking at a foreclosed home in Michigan that was being listed by Remix. Is the Title free if bank owned? Would there be extra cost after if the offer is accepted by the bank, besides traditional closing cost?

How low can you go on a bank owned home? Is there a certain percentage less you should bid, for instance on a house that was in the low 200's.

Thanks!

[baystater]

Hello

My family bought a REO about a year ago in the U.P. a little over a year ago. Granted it was only in the 10's of thousands so the could buy it out right with cash. But from the experience I learned that.

1. Banks want to eliminate what REO inventory they have. Remember when they take the house back they have to pay the taxes on that house and perhaps some other expenses you can't see like a basic hook up for electricity. ($30.00 month for my family whether we are there or not.) It can add up.

2. The longer the property sits the lower you can bid. If the property only has been on the market for a month, then more than likely the bank will only allow a haircut of maybe 5% maybe a little more. BUT if the property been sitting on the market for 6 months or longer I'd shave off 20% to 30% maybe even more if that home is in a undesirable or dying area. If in doubt remember this rule of thumb from economics. The market sets the price . And right now the market is not kind to sellers. This is true both in Michigan and most the rest of the of country. My want to look at Zillow - Real Estate Valuations, Homes for Sale, Free Real Estate Information to check comps on the neighborhood your looking at.

3. Cash rules. If you have enough cash to buy the house outright then your golden you go ahead and make that low offer and try to demand for all closing cost to be carried by the bank. If your dependent on a loan then you may have to carry the closing costs. (don't know about any additional costs besides basic closing cost.) In our case we just decide to carry the closing cost because we got a ridiculously low deal. Basically we just had to pay for the transfer of title.

Honestly there's so much inventory on the Michigan market you should be able to get a great deal in most of Michigan.
I know a lot of people are down on Michigan right now and are leaving. But all I can see is opportunity for a smart long term investor. There's money to be made by being patience and waiting out the hard times.

Good luck.

[Adieoz]

Hi. I am a realtor and I market REO property for a living (ie: I represent the banks that own these properties), so I see how things work on the other end. I think that baystater had some great advice although not all of it is accurate. Just in case there are any lawyers out there I want to say that I am not an attorney, but I think that I may have some helpful advice to offer.

When the bank gets the property back they are already taking a huge loss...first of all the unpaid interest, attorney costs for the foreclosure and eviction if necessary, rekeying, securing, trash out, utilties, taxes, insurance, realtor commissions, closing costs, title insurance...I could go on all day but I think you get the point. Sucks for them, but doesn't really matter for the sake of negotiating. And it is of course a buyer's market, so you are in the position to negotiate a great deal.

It is true that the bank does not want to own the property and that they will eventually lower the price to find the market. I have never, ever, in over 100 deals seen a bank come 20 or 30% of their price. My experience has been that they would rather lower the price gradually over time to find the market then accept an offer so far off the list price without offering it to the entire market at the price. That being said here is my advice:

First and foremost...hire a realtor!!! As a buyer you should not have to pay a buyer's agent one cent and then you will have someone representing YOU. The bank has already agreed to pay the agent who brings the buyer. Make sure you hire someone well versed in foreclosure property and do not call the agent that has the house listed. They are working for the seller and are contractually obligated to represent the seller's best interest. If you are not sure of a good realtor in your area...ask your friends for referrals or call some local companies and tell them you are looking for a buyer's agent who specializes in REO (Real Estate Owned) property.

A few things to keep in mind as you proceed...absolutely, positively have an inspection and write in your offer "seller to have all utilities turned on for inspection"

Anyway, I feel as though I have been rambling, but feel free to let me know if you have any other questions.

[catherine777]

what about the areas near Palisades Nuclear facility? I am being relocated there and would like info about the area. I see a lot of price differences. what about the Holland area? Northhaven, southhaven? thank youl.