Buying Foreclosures - Leave Extra Time For Signing
When buying a bank owned home, you shouldn’t be surprised to learn that banks are looking for ways to cut closing costs. One of the ways they do this is by having one title company handle all their transactions throughout any given state. When buying San Jose forecloses homes, for example, it’s common to work with a title company from Southern California to get your home closed. Why should you care? When it comes time to sign your closing papers, you will need to have the title company send the documents to a local notary in order for you to sign. It’s really nor practical to travel to L.A. to sign to buy a new home, unless you’re looking for reason to get out of town during the week. After the documents are brought to San Jose and you sign them, the notary must send them back overnight mail to the title company. This extra step can cost an additional couple of days in your schedule. Keep in mind that many foreclosure home purchases include language that states a buyer can be penalized $100 per day for every day the buyer is late closing. So it pays to plan ahead and schedule your signing as early as possible. For up to date info on the local real estate market go to www.GaryNobile.com or call Gary at (408) 247-4029.
Monday, September 27, 2010
Monday, September 20, 2010
Bank Owned Homes - A PASSIVE approach Can Cost You
Bank Owned Homes - A PASSIVE approach Can Cost You
When a buyer purchases a Bank Owned Home, it’s common that the bank will require the buyer to sign addendum prior to accepting the buyer’s offer. One of the clauses I typically find in these addendums is in regards to passive contingency removal. What this means is that time, not a written waiver, determines if buyer removes their contingencies. For example, if a buyer submits an offer and signs the bank’s addendum, the buyer automatically agrees to remove their contingencies as of a certain date. This differs from a typical real estate transaction where the buyer must provide a written notification to the seller in order to remove contingencies. Who cares, you may ask? If a buyer finds a problem with the home during an inspection phase and fails to provide written notification to the bank by the date specified in the addendum, then that constitutes acceptance of that item. If it’s a significant issue, like a major foundation or roof issue, then the buyer can still walk away from the transaction but the bank will likely keep their deposit! Know the clauses, or have an expert Realtor know them for you.
For up to date info on the local real estate market go to www.GaryNobile.com or call Gary at (408) 247-4029.
When a buyer purchases a Bank Owned Home, it’s common that the bank will require the buyer to sign addendum prior to accepting the buyer’s offer. One of the clauses I typically find in these addendums is in regards to passive contingency removal. What this means is that time, not a written waiver, determines if buyer removes their contingencies. For example, if a buyer submits an offer and signs the bank’s addendum, the buyer automatically agrees to remove their contingencies as of a certain date. This differs from a typical real estate transaction where the buyer must provide a written notification to the seller in order to remove contingencies. Who cares, you may ask? If a buyer finds a problem with the home during an inspection phase and fails to provide written notification to the bank by the date specified in the addendum, then that constitutes acceptance of that item. If it’s a significant issue, like a major foundation or roof issue, then the buyer can still walk away from the transaction but the bank will likely keep their deposit! Know the clauses, or have an expert Realtor know them for you.
For up to date info on the local real estate market go to www.GaryNobile.com or call Gary at (408) 247-4029.
Wednesday, August 25, 2010
Why Condition, Location are Key for FHA Home Buyers
Why Condition & Location is Key for FHA Home Buyers
Now that FHA loans are again a hot item, particularly with first time home buyers, there are a few things you should be aware of. First, the condition becomes very important. In order to obtain an FHA loan, the property must be appraised by an FHA appraiser. An FHA appraiser must disclose any “inhabitable conditions” in his/her appraisal. Once and inhabitable condition is disclosed, it must be repaired prior to the close of escrow before FHA will fully approve your loan.
Here’s a practical example. Let’s say you found a house for sale in San Jose but it was missing a toilet or a light fixture (I took this pic while recently previewing a home for an FHA buyer). This would be considered inhabitable and would have to be repaired before closing on the purchase of that home. Another inhabitable item an appraiser would cite (and I’ve had this happen to me while working with other FHA buyers) is a missing cabinet door in a kitchen. I’m not sure how they consider this inhabitable, but they didn’t ask me my opinion but merely gave me the rules to abide by. Where it can get sticky is when you want to buy a home but don’t’ know what will be called out in an appraisal. You make an offer that the seller accepts only to find out that repairs need to be made that were not part of the original contract. If a repair agreement cannot be reached with the seller (and if your offer was properly prepared) you should be able to walk away from the deal and get your deposit back. Unfortunately, that money you spent for the appraisal or any inspections is gone.
Another issue that pops up on home purchases with FHA loans is the location. If you are buying condo, the complex must be FHA approved. There are places you can go to find out if the complex you are interested in approved, but always check with your lender before writing an offer because condo complex FHA approvals can and do change. I would recommend to buyers with FHA loans that you understand what you can and cannot do BEFORE you start investing in appraisals and inspections. For more info send an e-mail to me through my website http://www.garynobile.com/.
Gary Nobile has been a licensed Realtor in Santa Clara County for over 20 years and serves on the Board of Directors of the Santa Clara Chamber of Commerce. (408) 247-4029
Now that FHA loans are again a hot item, particularly with first time home buyers, there are a few things you should be aware of. First, the condition becomes very important. In order to obtain an FHA loan, the property must be appraised by an FHA appraiser. An FHA appraiser must disclose any “inhabitable conditions” in his/her appraisal. Once and inhabitable condition is disclosed, it must be repaired prior to the close of escrow before FHA will fully approve your loan.
Here’s a practical example. Let’s say you found a house for sale in San Jose but it was missing a toilet or a light fixture (I took this pic while recently previewing a home for an FHA buyer). This would be considered inhabitable and would have to be repaired before closing on the purchase of that home. Another inhabitable item an appraiser would cite (and I’ve had this happen to me while working with other FHA buyers) is a missing cabinet door in a kitchen. I’m not sure how they consider this inhabitable, but they didn’t ask me my opinion but merely gave me the rules to abide by. Where it can get sticky is when you want to buy a home but don’t’ know what will be called out in an appraisal. You make an offer that the seller accepts only to find out that repairs need to be made that were not part of the original contract. If a repair agreement cannot be reached with the seller (and if your offer was properly prepared) you should be able to walk away from the deal and get your deposit back. Unfortunately, that money you spent for the appraisal or any inspections is gone.
Another issue that pops up on home purchases with FHA loans is the location. If you are buying condo, the complex must be FHA approved. There are places you can go to find out if the complex you are interested in approved, but always check with your lender before writing an offer because condo complex FHA approvals can and do change. I would recommend to buyers with FHA loans that you understand what you can and cannot do BEFORE you start investing in appraisals and inspections. For more info send an e-mail to me through my website http://www.garynobile.com/.
Gary Nobile has been a licensed Realtor in Santa Clara County for over 20 years and serves on the Board of Directors of the Santa Clara Chamber of Commerce. (408) 247-4029
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