Question by BlackDahlia: If we hire a real estate agent, can they work with us on foreclosed properties?
Can most real estate agents help their clients with foreclosed properties, or do they usually just stick to listings with home owners? We’re looking into buying, but are on a limited budget, and want to look more closely into foreclosures. Thanks.
Answer by arealtorlady
Yes, a real estate agent can work with you on foreclosed properties. The important thing is to interview agents and make sure they have the knowledge and skills necessary to help you achieve your objectives.
Most states have provisions for buyers to have their own agent (a buyer agent). But not all agents are created equal. Some are more experienced than others.
There are a number of ways that agents can help a buyer with properties that are not listed in the Multiple Listing Service.
HUD properties (http://www.HUD.gov) are foreclosed properties that have been insured by the federal government (i.e. FHA and VA loans, etc.). In order to make a bid on these properties, you must do so with the help of a real estate agent whose company is registered with HUD. Ask the agents you are interviewing if their company is registered and if they have ever helped a buyer purchased a HUD home. You can also see what homes are available at the website above.
Get a list of foreclosures from the county where you live. Ask about the procedure to make a bid on a particular property. Normally you need to already have been approved by a lender, so you have the money ready within a short period of time.
Ask potential agents if they have ever helped a buyer purchase a foreclosure. Also ask if they have experience with “short sales” (pre-foreclosures).
You may have to interview a lot of agents to find one who can help you, but you can probably search on the internet to find one. You could do a google search something like “town real estate, foreclosures, buyer agent” to cover all of the bases.
In general, I recommend that buyers find a good buyer agent by selecting someone who has a CRS and ABR designation. CRS means Certified Residential Specialist and ABR means Accredited Buyer Representative. CRS is the “cadillac” of designations and means that the agent has significant experience as well as has taken the time (and money) to take additional training courses. ABR courses focus on helping buyers. However, neither of these designations assure that an agent has experience with foreclosures. They just mean that the agent is conscientious about improving their skills so as to better help their clients. You would still have to interview them carefully.
There are currently a lot of foreclosures in the Multiple Listing Service (at least in my area and probably in yours). These are usually described as “corporate owned” properties. Also short sales, whereby the property will be sold for less than the owner owes on the property. And the way you buy these is the same as purchasing a home in the normal manner. The difference is that the lender must give approval for the offer (in the latter case) and that the lender is the owner (in the former case).
In any case, just because a property is a short sale or a foreclosure doesn’t mean it’s a “good deal.” A good buyer agent will do a market analysis on the home you wish to purchase to assure that you don’t pay too much for the property. In recent years, many buyers had “zero down” loans and purchased their homes at the peak prices of the market. Now, in many parts of the country, values have declined so that the home may be worth much less. That’s where “short sales” come in.
Hope this helps.
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