Archive for the 'Foreclosures' Category

Buying foreclosure auction properties online can save you time, effort and money, but you need to make extra research to protect your investment.

When you buy a property from an online foreclosure auction, the auctioneer gives you time to research the properties, including time to physically inspect the properties, although all these activities have schedules and time frames.

In a foreclosure auction conducted in a building where bidders are physically present, participants are also given time to inspect the properties, although in most cases, properties auctioned off by courts can only be inspected from outside.

Both online and conventional foreclosure auctions sell properties on an as-is basis. Some auctioneers also ask buyers to sign waivers of the ten-day post-auction inspection period described under Title X, which gives winning bidders the right to inspect the house for lead-based paint.

In most cases, companies holding both types of foreclosure auctions also provide information on the foreclosure properties to be auctioned off on their web sites. But companies holding purely online foreclosure auctions provide more detailed information and more photographs as they are targeting buyers that rely mostly on information available online. Prospective buyers can look at a lot of properties online before choosing certain properties that they like to inspect physically.

What sets the two ways of buying foreclosure auction properties apart is the bidding environment. When bidding online, you are in the privacy of your home or your office, allowing you to focus on your notes and on the process of bidding without the grumblings, mutterings and tension common in a conventional auction.

In a conventional auction, there is also the risk that you can get hyped up by the intensity of the bidding that you lose sight of the fact that you are already bidding more than the real value of the foreclosed property.

When considering bidding online, check the reputation of the auctioning company. Avoid participating in newly launched auction firms that have not shown concrete proofs of their intentions in the real estate sector.

Remember that you are giving your credit card number for verification and deposit purposes, so you should only trust companies that have been successful in the real estate auction business for a long time.

Additionally, read the Contract for Sale of Real Property and the Auction Terms and Conditions thoroughly before registering for online bidding. Reputable auction companies provide clear and detailed instructions on buying foreclosure auction properties online to protect not only themselves but also buyers.

The foreclosed homes sale recently closed by Goldman Sachs Group in downtown Kendall, just outside Miami, showed how deep condo prices have fallen in the area over the past year.

Goldman sold a total of 158 foreclosed condo units in its Kendall project called Downtown Dadeland for only $113,000 each, equivalent to just 33 percent of the cost of construction and the land. The units are part of a seven-building residential and commercial complex in Kendall, which is about six miles from downtown Miami.

According to Peter Zalewski, founder of Bal Harbour-based property brokerage Condo Vultures LLC which reported the condo sale on its website, Goldman took a big price cut from the sale.

The fortunate buyer was a partnership created by Nova Scotia-based Southwest Properties Limited and Armco Capital, which made a cash payment of only $17.9 million for the condo units. The payment is equivalent to around $109 per square foot, substantially below the estimated building costs of around $300 per square foot, based on computations made by Jim Spatz, chief executive of Southwest Properties, and by Condo Vultures owner Zalewski.

The deeply discounted foreclosed homes sale is nonetheless not a rarity in the Miami area, where average condo prices have fallen by 37 percent over the past year to only $137,900 in the July-September quarter.

Based on a report released by the Florida Association of Realtors, sales of condo units have increased by 43 percent to almost 1,800 units during the quarter because of the sharply discounted prices. In September, the median prices for new and pre-owned houses and condo units dropped to $159,000, marking a 30-percent drop from the median in September last year.

The Downtown Dadeland, which had its groundbreaking in 2003, was sold at a low price despite its being next to the popular Dadeland Mall, which is operated by Simon Property and which is anchored by the biggest Macy’s store in South Florida.

The condo units range from studio units to three-bedroom units measuring 1,100 square feet on average. According to Spatz of Southwest Properties, the partnership will rent out the condo units for about 3 to 5 years until condo prices in Miami improve.

Goldman Sachs disposed of only the condo portion of the Dadeland development in the foreclosed homes sale. It still owns the commercial portion of the complex. According to Zalewski, the complex was built at a cost of $224 million and Goldman Sachs acquired it through foreclosure.

The Gateway Center, a prominent building in downtown Providence in Rhode Island, has been acquired by U.S. Bank for $13 million at a foreclosure sale. The bank is the trustee for mortgage-backed securities holders on the building.

The bank’s bid of $13 million was the only offer made on the building. Typically at foreclosure sale, banks bid the total mortgage amount owed to them. According to industry experts, this is the second time in almost five years that banks took ownership of Gateway Center after borrowers missed on their mortgage payments.

During the auction, Joseph R. Paolino Jr., former Providence mayor and a downtown landlord, asked several questions about Gateway Center, including whether it has occupants and if taxes are current.

The downtown building has been vacant after Fidelity Investments relocated its workers from the city to the Smithfield offices of the company.

According to industry experts, Class A office spaces are clogging the Providence market. The Gateway Center belongs in this category which made it difficult for the 135,110 square feet building to attract tenants.

Compounding the problem of the building is its configuration into a single large tenant. Experts said that single large tenants prefer suburban settings which they deem more convenient compared with a downtown location.

Furthermore, the building is embroiled in a complicated financial arrangement. The Gateway Center stands on a land owned by Capital Properties. Since 2006, the land has been leased from Capital Properties by RI Gateway Properties, which owns the building. The lease for the land was later acquired by RI Gateway using an $18.8 million loan it took out from Wachovia Bank. RI Gateway secured the loan by mortgaging the property rights that it owned as part of the lease.

Industry experts explained that the foreclosure auction involves the lease owned by RI Gateway and not on the land ownership of Capital Properties. In short, Capital Properties has never been a part of the foreclosure process.

Experts added that the state pension system was the previous owner of the building’s lease until 2006. The state pension system took over the lease ownership after the previous owner defaulted. The pension system decided to sell the lease to RI Gateway after it got entangled in bankruptcy proceedings. The Gateway Center’s construction was made possible by a $23 million bond issued by Rhode Island.

The national rate of home ownership dropped for the second quarter this year, showing once more that foreclosure is still a force to reckon with in the current housing market.

German lending company, Bayerische Landesbank has filed a bank owned foreclosure lawsuit against developer Manhattan Capital and its business partner, RREEF Global Opportunities Fund, a Deutsche Bank subsidiary.
The lender sued the Midtown-based developer in connection with the defaulted loans amounting to $51.7 million for a condominium conversion project located in New York City. Both Manhattan [...]

Units at the Concordia condominium building located in Cape Coral, Florida is selling like hot cakes as its new owner sells them at less than their original price. The condominium was once under bank owned homes foreclosures. Its unfinished structure then was a glaring evidence of the crisis in the housing market.

When city officials in Perris, California decided to hire a specialist to beautify bank foreclosure property to protect its value, they never thought that it would attract worldwide attention. Already, television crews from various countries visited the city to film the makeover of these foreclosed properties.

Foreclosure has become a nightmare to thousands of homeowners. But some people have seen business opportunities on bank foreclosed homes. There are those offering cleaning services, counseling and now caretaking.

People who are doing the caretaking of foreclosurehomes for sale for realtors are called home tenders or managers. Their task was to furnish the foreclosed [...]

The Senate may have partly redeemed itself from its rejection of the bankruptcy reform measure recently by approving on Wednesday a measure that would enhance the government foreclosures program.
The bill, voted 91 to 5, would protect mortgage servicing firms from litigation if they modify loans under government foreclosures schemes and would require lenders to notify [...]

Distressed homeowners in Illinois have reason to feel some level of relief after Illinois Governor Patrick Quinn signed into law a legislative initiative that would mitigate the rising number of foreclosure properties across the state.
The legislation, coded Senate Bill 2513, would give defaulting mortgage borrowers 90 days to seek HUD-certified foreclosure prevention counseling and negotiate [...]