Buying a Bank Owned Property... frustration

[ultrarunner]

My neighbor gave his home back to the bank... prices are down about 65%... ethics aside... he was paying almost 10k per month... his loan $9000 + taxes of $1500 + another $300 for insurance...

Got to thinking I should look into making an offer because the land adjoins my land on one side and my parents on the other...

Spoke with the agent handling the property for the bank... they will not except offers till the property is vacant... could be another year due to California Laws and delay tactics... then the bank needs to inspect and the property has to be marketed to owner occupied buyers only...

Each buyer must be pre-qualified with Wells Fargo in order to make an offer... the buyer doesn't have to use Wells Fargo... they must go through the application process...

I told the agent I would be willing to make an all cash offer as-is with one condition... I pay for a survey so I know the exact boundaries... there are or have been encroachment issues...

I'm thinking Banks are really not interested in selling property/closing the books... if they were... why would they require a cash offer to go through loan approval???

The former owner and current occupant has lived their almost 30 months since they stopped paying the mortgage... he had several long drawn out loan mod negotiations where he had to be so many months behind before they could initiate the process...

 

[brin]

That sure does not sound right to me...If you want it bad enough it might be worth it to get your atty. involved and let him handle the offer....Let Wells Fargo explain to your atty. why you have to fill out those forms...Just a thought.

 

[rambler]

Banks seem to be very detached from the real world, don't they? Too much or not enough govt regulation, not sure which, but don't see how we ever straighen out the ecconomy until the math starts making sense, and things like this don't make sense....

--->Paul

 

[jonyyuma]

I deeply regret not going down to the court house and buying my neighbors home from those steps..I could have cleared it ..

 

[MoKelly]

You would buy the property now even though the current resident won't be out of the property for another year?

MoKelly

 

[ultrarunner]

That sure does not sound right to me...If you want it bad enough it might be worth it to get your atty. involved and let him handle the offer....Let Wells Fargo explain to your atty. why you have to fill out those forms...Just a thought.

I have only been turned down by a bank one time... and it was Wells that left me standing at the alter...

Everything was going along fine... the appraisal, income, credit... etc... 3 days before the closing, the Title Company called Wells and learned Wells will not be making the loan because the property doesn't meet underwriting requirements... the land is over 5 acres???

No where was this brought up and the appraisal clearly stated the parcel size... anyway... through my boss at the time, I was able to close with cash and save the deal... I had him paid back in 60 days...

As hard as I try... Wells keeps coming back into my life...

 

[ultrarunner]

You would buy the property now even though the current resident won't be out of the property for another year?

MoKelly

He is playing hardball with the bank... absolutely can't stand them.

His lawyer sent a letter saying he will move and turn the home over in good condition for a cash for keys payment... if he doesn't get it... the rules California enacted to protect renters go into effect... his tenant at the in-law has 9 months left on the lease and foreclosures do not trump tenant's rights as long as the tenant pays the rent to the bank.

 

[MotorSeven]

I'm sorry, I think something was in my eyes....did you write: Ten Thousand Dollars a month is his payment??

How many ac are we talking about?

 

[blueriver]

Mortgage foreclosure insurance ... it has to go thru the process so the lender can collect on the insurance to recap the loss and then they can sell it.... thats what I have been told.

I recently did a real estate auction for the lender ... they needed $250K the last bid was $227K they declined paid my fee's and expenses ... then I was told the foregoing by the lenders rep. It appears to be a win win for the lender.

 

[tractchores]

Not sure where it is in the process, but if he still in it then you may be able to try for a short sale.

 

[ultrarunner]

Mortgage foreclosure insurance ... it has to go thru the process so the lender can collect on the insurance to recap the loss and then they can sell it.... thats what I have been told.

I recently did a real estate auction for the lender ... they needed $250K the last bid was $227K they declined paid my fee's and expenses ... then I was told the foregoing by the lenders rep. It appears to be a win win for the lender.

This makes sense... can't think of any other reason unless the bottom line is more dollars when it is said and done.

 

[ultrarunner]

Not sure where it is in the process, but if he still in it then you may be able to try for a short sale.

They tried short sales... didn't have any luck... the lender turned them all down.

The neighbor paid 1.3m for the place... it was 3 years old... my place is 55 years old next door...

All was good till he went to refi his loan the banks said the property no longer appraised high enough... they offered to do it if he kicked in 100k to lower the principal balance which he agreed... then they said the value had fallen even more...

At that point he told them he wanted a loan mod and was told we can't discuss it till you are 3 or 6 months behind... I don't remember which.

So he stopped making payments a little over two years ago and has continued to live there while applying for different loan mod programs...

He has an active lawsuit against Wells because the bank took the money from his Tax impound account and didn't pay the taxes... apparently this is not allowed.

The bottom line is the bank now owns the property and he still lives there...

 

[KennyG]

I think all the banks are nuts now. I have a couple of loans with Wells Fargo. Last year I refinanced one and they hung it up and almost bailed out because I had some incomplete remodeling in progress. Keep in mind - they already held the mortgage on the property and I was actually reducing the principle.

Another recent purchase was very nearly derailed by Chase because at the last minute they decided the seller (1000 miles away) would have to replace two damaged windows. This was a 20% down mortgage and I had already decided to replace all the windows ($20K) after I got possession. It took me a half dozen phone calls to get them turned around and I had to sign a paper promising to replace the windows.

 

[ultrarunner]

I think all the banks are nuts now. I have a couple of loans with Wells Fargo. Last year I refinanced one and they hung it up and almost bailed out because I had some incomplete remodeling in progress. Keep in mind - they already held the mortgage on the property and I was actually reducing the principle.

Another recent purchase was very nearly derailed by Chase because at the last minute they decided the seller (1000 miles away) would have to replace two damaged windows. This was a 20% down mortgage and I had already decided to replace all the windows ($20K) after I got possession. It took me a half dozen phone calls to get them turned around and I had to sign a paper promising to replace the windows.

You must be very convincing... I have heard similar that killed the deal.

 

[forgeblast]

We had a bit of a problem with wells, they were worried that the value of the property would be tied up in the land since its 20 acres, big pain dealing with them.

 

[MasseyWV]

Banks seem to be very detached from the real world, don't they?

Banks are only interested in one thing... money. In fact, they remind me of sleezy used car salesmen who try to sell you on a song but are only interested in their own bottom line.

If a bank or a realtor tried to make me go through their loan process after I have made a cash offer, I would tell them where to go.

 

[ultrarunner]

Banks are only interested in one thing... money. In fact, they remind me of sleezy used car salesmen who try to sell you on a song but are only interested in their own bottom line.

If a bank or a realtor tried to make me go through their loan process after I have made a cash offer, I would tell them where to go.

I may just forget the whole thing... at least this is my gut reaction.

On the other hand... if it is meant to be... it will... at least my Grandmother always said this.

 

[SPIKER]

had a similar situation on piece of property in front of mine. old run down trailer and barn. the people walked away and the bank had it. I called the bank and made a phone offer of cash 18K. The loan officer said NO they owed 63K (this was a real dump on 7/8 acre) and I literately busted out loud laughing. I called back a week later after someone was out to survey it. I offered them 18,5 (the trailer had to be removed the barn roof was mostly loose and the land was really mostly overgrown dump.) They said NO but they came down to 30K so I asked for the bank manager. After talking to them and explaining conditions and such he came down to 25K & I stated nope no way over 18,500 was my top price. a few days later someone comes out and brush hogged up onto my property by 40 or so feet damaged some of my trees ect. So I called bank and complained and found out it was the new owners (close personal friend of the Loan officer) paid 15K for it. She is a pain in *** for a neighbor but much better than the white trash coon dog breeder that lived their prior. I showed her that her property did not go where she thought it was and cleared the air about them using that part of my property. She has turned out to be pretty nice person for most part so not complaining much...

It sure brings new meaning to not what ya know but WHO ya know...

I know legally I could have raised a stink but without something in writing it would be exercise in futility.
Mark

 

[newbury]

Had a similar situation down here that really peeved me.
Bank had a short sale going for $220K. Nice new house, about 10 acres. Sat on the market forever. Realtors could never seem to get in touch with the person at the bank. The POC was always on vacation or some such. Then all of a sudden it's relisted with only 5 acres for $199K and sold to a local real estate person within hours. A lot of insider dealing.
We were offering the full $220K, but did not have "boots on the ground".

The house we eventually bought was only listed briefly, the realtor had not even put a sign up for it, I found it on the web. We drove from DC to NE Mississippi (810 miles) and bought it the next day.

 

[300UGUY]

I just bought a commercial building, it was bank owned, having been repoed. Put the offer in, it took almost a month to get a reply. It seems that unless it is full price offer, the offer must go to a bank committee that meets once per month. No one person at the bank has the authority to approve a deal for less than asking price. Then they took a week to get the counter to my agent, in writing. I looked around for commercial loans, but they really sucked, the best was 5 years, 5%, and a choice of amortization schedules of 15, 20 or 25 years. Most lenders only do residential, so commercial loans are not as competitive as residential. Really nobody was in a hurry until they accepted my offer - then they wanted to close before year's end.