Something crazy is happening here in Los Angeles. The streets are wild with buyers who want to buy property and buy it NOW!!! Especially bank owned properties under $500,000.
At my most recent open house of a foreclosed property I had people coming in with their whole family - mom, pop, granny, cousins, brothers, sisters, kids. They know time is of the essence and they better get the family opinion now!
I felt claustrophobic from how closely each buyer was talking into my ear... kind of whispering, "What do I need to do to get this house??". People who couldn't speak English handing me their phones with a brother or sister translating to me.
To each I said the same thing...Highest and best offer.
Then we have the investors.... they don't come with family or kids... either alone or with a large burly gorilla-like being called the "contractor". They wander through, knock on walls, look up at the ceiling, look down at the floor, slink into the basement. They say things like, "we could knock this out" and "this has to go". Then they walk over to me with a smile and say "Definitely won't qualify for a loan!".
I see the ears of they other buyers prick up. It is the fear of every first time home buyer.
Although I love investors for their ability to complete a transaction quickly and without emotion. I have to fight the good fight for the little guy. That young family with the hard working mum and dad and then there's junior who plays baseball and gets good grades. They just want a little slice of heaven to call their own.
I am currently in a transaction like this now and there is hope for those who need financing to buy their first house......here is how we are fighting back:
FHA 203K Rehab Loan - This is a brilliant loan in which you can add the cost of rehabbing the property to the loan and subsequently there is no need for the houses current condition to "qualify" for the loan because it will qualify once the rehabbing is complete.
Step 1. Have your lender pre-qualify you for the loan with the specific property in mind.
Step 2. Your lender will have a contractor who can go to the property and give a bid to rehab it.
Step 3. Write up your offer as per usual with your highest and best bid - keep it as clean and simple as possible and check the financing off as an FHA loan - in notes add that it is a 203K Rehab Loan. You have to beat these people coming in with an all cash, 10 day close as is offer. So bid high! Not always but in many cases the bank will go with the highest offer - they want the most amount of money for their property.
Step 4. Accepted offer from the bank - Loan docs come through - Close of Escrow
Step 5. Construction begins!
Ok - so maybe I have simplified the whole process a little but there it is, a fabulous way to get that house you have been looking for with the money to fix it built into your loan! Brilliant!
Yay for the little guy ~ there is hope that you can have the American Dream and go into home ownership the old fashioned way...buying a piece of S#*T and fixing it up the way you want it!
At my most recent open house of a foreclosed property I had people coming in with their whole family - mom, pop, granny, cousins, brothers, sisters, kids. They know time is of the essence and they better get the family opinion now!
I felt claustrophobic from how closely each buyer was talking into my ear... kind of whispering, "What do I need to do to get this house??". People who couldn't speak English handing me their phones with a brother or sister translating to me.
To each I said the same thing...Highest and best offer.
Then we have the investors.... they don't come with family or kids... either alone or with a large burly gorilla-like being called the "contractor". They wander through, knock on walls, look up at the ceiling, look down at the floor, slink into the basement. They say things like, "we could knock this out" and "this has to go". Then they walk over to me with a smile and say "Definitely won't qualify for a loan!".
I see the ears of they other buyers prick up. It is the fear of every first time home buyer.
Although I love investors for their ability to complete a transaction quickly and without emotion. I have to fight the good fight for the little guy. That young family with the hard working mum and dad and then there's junior who plays baseball and gets good grades. They just want a little slice of heaven to call their own.
I am currently in a transaction like this now and there is hope for those who need financing to buy their first house......here is how we are fighting back:
FHA 203K Rehab Loan - This is a brilliant loan in which you can add the cost of rehabbing the property to the loan and subsequently there is no need for the houses current condition to "qualify" for the loan because it will qualify once the rehabbing is complete.
Step 1. Have your lender pre-qualify you for the loan with the specific property in mind.
Step 2. Your lender will have a contractor who can go to the property and give a bid to rehab it.
Step 3. Write up your offer as per usual with your highest and best bid - keep it as clean and simple as possible and check the financing off as an FHA loan - in notes add that it is a 203K Rehab Loan. You have to beat these people coming in with an all cash, 10 day close as is offer. So bid high! Not always but in many cases the bank will go with the highest offer - they want the most amount of money for their property.
Step 4. Accepted offer from the bank - Loan docs come through - Close of Escrow
Step 5. Construction begins!
Ok - so maybe I have simplified the whole process a little but there it is, a fabulous way to get that house you have been looking for with the money to fix it built into your loan! Brilliant!
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| Honey this one looks perfect!!! |
Yay for the little guy ~ there is hope that you can have the American Dream and go into home ownership the old fashioned way...buying a piece of S#*T and fixing it up the way you want it!
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