How to Buy a Foreclosure is a subject I’ve written about many times on this real estate blog, but today I want to focus in on a very important part of the process that very few people know about, including Realtors. Banks that foreclose on homes hire outside companies to list and market their foreclosed properties. Those companies hire contractors who clean up and maintain the homes, and they also hire Realtors to list the property. Just in this little chain of people and companies, you can get the idea that there are many intermediaries. But it gets better, or should I say it gets worse.
These companies hire asset managers, who coordinates many of the details necessary to manage the home and get it sold via all these other parties. This makes the asset manager the primary point of contact and decision maker for the banks, and it is the asset manager who the listing Realtor communicates with when an offer is presented by a selling Realtor. Get ready for the nightmare.
Asset managers typically only need a high school education, and many of the job applications on the Internet for asset managers indicate they only need two years of related real estate experience, which could have been working for a mortgage company during the mortgage fraud and real estate market crash.
No wonder they don’t understand the process of negotiating and documentation. Without going into great detail, let me tell you that asset managers never put a counteroffer in writing. Normally, of course, a buyer makes an offer and a seller will often counteroffer, which they do in writing. Not the foreclosing banks. Their asset managers do not understand basic contract law and real estate practice, and . . . they definitely do not understand the negotiating process. Instead, the asset managers give their listing agent some vague notion of what they would like, which often is impossible. (For example, it is impossible to get a lender’s letter requiring repairs before there is mutual acceptance on all terms and before an appraiser has even been appointed by a bank which hasn’t even been hired to process a loan yet.) There are many examples of ridiculous and foolish responses by asset managers.
Asset managers not only require the selling Realtor to draft the bank’s counteroffer for them when the Realtor represents the buyer, but . . . and I’m not kidding or exaggerating here . . . the asset managers also want the selling Realtor to literally guess what the banks’ counteroffer should be. I kid you not, the listing agents are typically unable to articulate their own client’s position. Their own clients (the asset managers) refuse to put any counteroffer in writing or articulate what they want in writing!
This can put a buyer in a twilight zone of trying to buy a home, having agreed upon a price, but unable to get the bank’s representative to cooperate using standard Washington state real estate documents and processes.
No wonder our foreclosure market is such a disaster! There’s no adult supervision at these institutions. If you do want to buy a foreclosure, I understand the process, as frustrating and time consuming as it can be. I’d be glad to help you walk through this labyrinthian process, if you have a lot of stamina. If necessary, I’ll bring some adult supervision to the process on your behalf.
Fore more about the foreclosure process, the documents and timelines, and the processes involved in buying a foreclosure, simply do a search on this blog for “foreclosures” (without the quotes). There are dozens of articles.
See Foreclosures here.
Possibly Related Posts:
- Buying a Foreclosure and How Banks Kill Deals
- Foreclosure Ripoffs
- HUD Closing Requirements
- Lawsuits Against Auction.com
- Dangers of Buying a Fannie Mae Foreclosure Through Homepath