New Orleans Foreclosures
With the way prices have been increasing in so many of our neighborhoods, we’ve been getting more and more inquiries about how to buy New Orleans West Bank foreclosures.
Here are our top 5 tips for buying foreclosures
You need to work with a REALTOR®
Even though you’re tempted to try to lowball in the hopes they are saving on buyer’s agent commission, you’ll quickly discover that the banks will not negotiate directly with you. Find an experienced agent to make your offers on foreclosed properties.
You must be preapproved for a mortgage or have proof of funds if you’re paying cash.
The days of “let me find a property first, then I’ll worry about financing” are long gone. Foreclosure offers require you to prove you can perform right from the beginning. Get your mortgage lined up or have your bank statements in order, because banks won’t even look at your offer without the right documentation.
Properties are sold as is, with no repairs
If you are financing the purchase, you need to know whether or not the property fits the type of mortgage you are getting. If FHA or VA financing is your only option, the number of foreclosures that will meet those lending requirements will be minimal. Ask your agent how to find non-foreclosure properties that meet your needs.
Properties may or may not have utilities for inspections
Usually, utilities are turned off and the bank will not turn them on for your inspections. You may be able to have the utilities turned on at your own expense for the day of the inspection, with the permission of the bank/owner. Keep in mind, however, that if they have been off for over 6 months, everything must be up to code before the utility company will turn on gas, electric or water service. If this is the case, it’s probably in your best interest to move on to another property, since you won’t be able to adequately inspect for hidden defects.
You may be bidding against other buyers
Depending on the bank involved, there may be an open bidding process. This can work to your benefit because an open bid process allows you to see what the highest offer on the table is. You can choose to increase your bid if it’s a property you really want. If it’s a closed bidding process, know that you won’t get an answer to your offer until after the bidding is closed. That could be more than a week, so be patient.
PRO TIP: Have your agent write a 2 or 3 day expiration in your offer so you can move on to other properties if it’s taking the bank too long to respond.