Thread: Offering on a foreclosure

Originally Posted by scbecker

We recently found a home that just went into foreclosure. The house was originally being offered as a short sale and the listing had just expired when we called the listing office about the house. the listing office took my name an number when I called because they were unsure of why the listing expired. I received a phone call back from the former listing agent himself who explained to me that he was also the owner. He explained that he had to give the house back to the bank and that the house was now bank owned.

After talking to him for a while, he offered to let us see the home. We went and saw the home and are very interested in it. He said that his broker has agreed to act as a buyer's agent and then give him the commission on the home. It seems like there would be an advantage to using him as a buyer's agent since he already knows which bank owns the property, what was owed on the property and how much the house was approved for as a short sale. Do you see any potential risks to using him as a buyer's agent?

What steps should we take to ensure we are protected during the pursuit of this home and what pitfalls could there be?

Thanks in advance for any help and advice.

If it is already bank owned then I dont see there being any conflict of interest. This is the only reason you would need to be concerned. It might work to contact the loss mitigation specialist at the bank and see if you can work out a deal before it hits the market. Since you really dont know what brokerage will end up carring the listing and many ethically bancrupt brokers will try to hide its availability. Allowing them to double end the transaction. Let us know how things go and feel free to ask any of the questions you might have.

At least here in the Minnesota real estate market, almost all homes that become bank owned get listed on the MLS. I'm not sure exactly if this home has been re-listed with another agent?

As far as using that particular agent as the buyer's agent, I guess it really is a personal choice. Our team here in Minneapolis always encourages buyers to hire a top realtor and be represented in the transaction.

I hope this info helps. And congrats on looking to buy in this market. There are so many awesome deals out there right now!

The foreclosures can differ a fair bit I find, depending upon the bank.

that a bank owned property the original owner could let you in and see it because the first thing they do is change the locks.

Also an owner of a home who is a licensed Realtor is not allowed to short sale his own house!

Once the Banks do take possession they usually have thier own listing agent.