икониMany buyers today are seeking Central Oregon bank owned properties. Buyers believe bank owned properties offer a home at a price lower than other homes on the market.  This is not always the case.

Bank owned properties in Central Oregon usually come with their own list of issues.  Bank owned properties are sold as is generally.  The buyer needs to be very careful, every property should have a home inspection prior to closing but with homes that are bank owned should be inspected even more.  Here in Central Oregon there are other issues that a local REALTOR® will be able to advise you of also.

When purchasing a bank owned property the buyer will not receive a Seller’s Property Disclosure, the bank knows nothing about the property.  HUD homes do have a property report available, but this should never be used in place of your own home inspection.

Bank owned properties can have hidden issues, with winter quickly approaching these properties have a chance of broken (frozen) pipes and more.

Your list of bank owned properties may hold your dream home, but remember there are other homes in these same price ranges that actually may give you a better home at a better price.

Click on the line below for a current list of Bank Owned homes in each area.  You can also create your own search above.  I do provide at no obligation to you a daily email.

La Pine Bank Owned Homes

Three Rivers South Bank Owned Homes

Bend Bank Owned Homes

The real estate market in Central Oregon offers some great opportunities for a buyer today!  We have several bank owned homes on the market priced very low, sellers that are motivated and doing the best they can to compete with the bank owned homes.  Many times we can find a home that brings a mortgage payment lower than what you might pay for rent on the same home.  Sounds great, doesn’t it?

The above is true, we can sometimes find a home that you can purchase for less than you could rent it for, but there are factors to keep in mind other than the listing price. A few of the factors we need to keep our eye on are; taxes, home owners association dues, water district, insurance and possibly loan fees such as mortgage insurance.

Taxes – if a home has taxes of $1200 a year this will add about $100 a month to a mortgage payment.  What happens though when taxes are $2,400 or $3,600 a year, you guessed it the payment goes up.  Tax assessments should always be checked prior to writing your offer, so you can have a good idea what you might be looking at for a payment.  If a home is newer, checking to see that a full assessment has been completed is a good idea.  When a home is new, often time the county will only show the taxes on the land, not the improvement, this can open the door for a big surprise down the road.

Home Owners Associations – are often referred to as an HOA, some loans will require the fees associated with an association be incorporated into your loan, thus causing your payment to go up (even if not in your loan at some point this fee will need to be paid).  If an association fee is $200 a year, the increase in your payment is just over $16, but what if the association fee is $200 a month?

Mortgage Insurance – this can vary by the risk associated with the loan, type of loan and dollar amount of the loan.  If the loan you are expecting to use to purchase your dream home is less than 20% down, chances are you will be facing mortgage insurance.  You should check with your lender to what fees you might expect that will increase your payment.

Understanding what your payment will include in home ownership, can and will make purchasing a home less frustrating and smoother in the long run.  Being prepared as you start your home and loan search is the best advice anyone can give you.  Give me a call, I can help prepare you for this exciting time of your life.

Bank Owned Home Articles

photo courtesy of fontplaydotcom on Flickr

Today was the last day for a buyer to have a signed contract for both the first time homebuyer and the move up buyer.  So, now that the deadline has passed and no one really expected to see it extended yet again where do we go?  Back to normal?  Well what is normal?  A couple things to think about before you think you missed out on something.

Although you may feel like you lost out on a bigger tax return, what would you do with that return?  Most of you, if you were honest with yourselves, would spend it in less than a week.  The new big screen TV, a newer car, a vacation or carpet for the new house.  Am I wrong?

So, now that the big lure is over, lets look at what you can still obtain.

• Pricing – prices are still coming down in several areas and now that the “frenzy” is over will the market slow a little?  Only time will tell, but my guess from the agreed to pricing I saw this week I think you may be pleasantly surprised.
• Other programs, there are new programs being unveiled everyday.  One of the favorites right now is the Neighborhood Stabilization Program (NSP) this is a great program that allows for 100% financing in a creative way, on bank owned or foreclosed homes.  The NSP loan is basically a second mortgage that is interest free and payment free, as long as you met certain guidelines.  So, if you missed the tax credit but you buy a home for $10,000 less than you would have and you have a NSP loan which means no payment on about 20% of your purchase… you will be saving more than that $8000.
• The tax credit was just that a credit – not everyone got $8000 – so, did you really loose $8000?

If you are a first time home buyer there are several homes in Central Oregon that can easily be purchased for less than some are paying for rent.  If you are paying $850 or more a month for rent, purchasing a home very well may be a great option for you.  Give me a call, let’s see what we can do to save you more than $8000.

Bank Owned Home Articles

I am amazed at how many people are totally unaware of what the tax credit is and how helpful it can be to a home buyer. The current home buyer tax credit does not just benefit the first time home buyer but any homebuyer.

Below is a quick list of qualifications for the home buyer tax credit.

1. You must buy – or enter into a binding contract to buy a principal residence – on or before April 30, 2010.

2. If you enter into a binding contract by April 30, 2010 you must close on the home on or before June 30, 2010.

3. For qualifying purchases in 2010, you will have the option of claiming the credit on either your 2009 or 2010 return.

4. A long-time resident of the same home can now qualify for a reduced credit. You can qualify for the credit if you’ve lived in the same principal residence for any five-consecutive year period during the eight-year period that ended on the date the new home is purchased and the settlement date is after November 6, 2009.

5. The maximum credit for long-time residents is $6,500. However, married individuals filing separately are limited to $3,250. The maximum credit for first-time homeowners is $8,000 (up to $4,000 for married filing separately).

6. People with higher incomes can now qualify for the credit. The new law raises the income limits for homes purchased after November 6, 2009. The full credit is available to taxpayers with modified adjusted gross incomes up to $125,000, or $225,000 for joint filers.

7. The IRS will issue a revised Form 5405 to claim this credit on 2009 tax returns. The revised form must be used for homes purchased after November 6, 2009 – whether the credit is claimed for 2008 or for 2009 – and for all home purchases that are claimed on 2009 returns.

8. Homebuyers who claim the credit on their 2009 tax return will not be able to file electronically but instead will need to file a paper return. For homes purchased in 2009 there is an option to take the credit on an original or amended 2008 tax return.

9. The new law includes documentation requirements. See revised Form 5405 for details.

10. No credit is available if the purchase price of the home exceeds $800,000.

11. The purchaser must be at least 18 years old on the date of purchase. For a married couple, only one spouse must meet this age requirement.

12. A dependent is not eligible to claim the credit.

These qualifications are taken directly from the IRS website and the publication is referenced with a link at the bottom of this post.

One of the things that is misunderstood is that any buyer qualifies obviously that is not necessarily the truth.  Another is that you must close by April 30th – note it says be under contract – this means an accepted offer – with all parties agreeing to the terms of the contract.  If you are looking to purchase a short sale you may not have enough time to close escrow as you are at a the mercy of a third party to agree to the transaction.

IRS Publication 4819

So, you are starting to look for a new home and you find bank owned homes to be the most affordable!  So do a lot of other buyers, many times even in “this market” we are finding the bank owned home priced so well that there are multiple offers.

Homes you can expect a multiple offer situation is the home that is clean, not stripped of it’s fixtures and ready to move into.  So, how do you insure you are the winning offer on one of these properties?

1. Know the market – and make an offer that is reasonable.  If you are asking the bank to pay your closing costs, you may need to make your offer closer to the list price or possibly higher than list price.  Most banks are willing to pay up to 3% of the purchase price in closing costs, however if you are in a multiple offer situation you may want to formulate your offer so this is off set in the purchase price.
2. Apply for your loan ahead of time.  Most banks will ask for a pre-qualification letter (prequal) with the offer.  Having a good relationship with your lender will make getting this ahead of time or at the time of the offer much quicker.  If you plan to purchase with cash, the bank will want proof that you have these funds available.
3. Inspection – be sure you have a home inspection, many of these homes have sat vacant for some time prior to going on the market.  Many of the deficiencies of the home may not be as obvious as they would be if the home was occupied.
4. Make sure you have your own agent.  The bank has their agent, and using their agent will not get you a better price.  You deserve to have someone on your side and watching out for your best interests.

As a Certified Distress Property Expert, I am happy to help you purchase a bank owned home, short sale and even a standard resale property.  Real Estate is a crazy world, let me help you make it through the process without the stress.