Jeff’s Carlsbad Blog for First Time Home Buyers

Are YOU Interested in Buying an REO?

I just wrote an article that may interest you IF you are interested in buying an REO…or perhaps have little choice because of price range.

There are some important questions that I like to ask, so these might be useful for you to consider so you can decide IF buying an REO is right for you.

If nothing else, it will help you be prepared for the issues you need to confront during the search.


Search for Homes Community Information First Time Home Buyers Relocation Services and more How to get in touch with me

All content copyright © 2010 Jeff Dowler “The California Relocation Dude”


Do You Give Up Easily?

Posted in Psychological Stuff,REOs,Short Sales by Jeff Dowler on January 13, 2010
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Are you the kind of person who gets frustrated quickly?

Do you give up easily?

I hope not, if you are a buyer, especially a first time buyer, in this market.

In our area there is a ton of competition, with multiple bids on most homes in the lower price ranges (e.g., under $500K), and in particular for short sales and REOs. What this can mean is that you may not get the house you want because you get outbid by someone else. There are more and more cash buyers out there, especially investors, and banks often prefer cash deals over financed ones.

  • Because of the nature of this market, many of you may have to make more than one offer in order to finally get a home, and this can be frustrating. Plus it takes time.
  • The other issue is that in many areas the inventory is not increasing, so there are not a lot of homes to choose from that fit the budget, and the ones on the market often need a lot of work or for other reasons are not very desirable.

However, with the low rates we currently have, and the opportunity to take advantage of the First Time Buyer Credit, buying a home now can be a terrific opportunity for many of you. But try not to let yourself get too frustrated, and BE PERSISTENT. A savvy local REALTOR can be your best defense.

Search for Homes Community Information First Time Home Buyers Relocation Services and more How to get in touch with me

All content copyright © 2010 Jeff Dowler “The California Relocation Dude”

Buyer’s Market? Hmmm

The media implies that it is a buyer’s market out there. In many areas, and many segments of the market, that IS, indeed, true.

People also seem to think that this is true for the REO/bank owned market.

Home for sale

That may be true in some areas but it is certainly not the case here in North San Diego County in Carlsbad, San Marcos, Escondido, Oceanside and similar areas. Multiple offers on just about every REO (and short sale) and with these properties selling in many cases over asking suggests it is a BANKS’ market, NOT one favoring buyers.

Buyers are, in many cases submitting offers on multiple properties, and are losing out on several properties before they are successful. While this is not the case in mid- and high-range properties it is very much a part of the lower end market where many first time buyers need to start out.

dollar_signThe other shift we are seeing is many more cash buyers (often investors) who will often beat out regular buyers with loans since the REO banks (1) do not have to worry about an appraisal or a loan, and (2) they can get their money more quickly.

This is not to scare you away but just to paint a bit of a reality picture so you are not surprised. Given me a call if you have questions, or talk with YOUR agent to learn more about the reality of YOUR market. It may not be what you think it is.


10 Buyer Challenges for Today’s Market

The Question Used to be – How Much Less Will the Sellers’ Take?

Can Your Transaction Get Audited? YES!

Posted in General Information,REOs by Jeff Dowler on August 22, 2009
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This may not apply to all transactions during the process, but it does at least with FNMA (Fannie Mae) and Freddie Mac if you are purchasing an REO. Perhaps other lenders as well.

I am in the midst of a transaction with a very tight deadline and all of a sudden we learned that FNMA has pulled the REO file for an audit.

It has nothing to do with the offer itself (this is a cash deal, not a loan), the buyers, or the transaction, but apparently is a routine, random, periodic audit that they do of their REOs that are being serviced by various banks. No warning.

This is NOT to say this happens a lot (the listing agent says this is the FIRST in all of her REO transactions in over 2 years) but it CAN happen, without warning.

This causes a delay of an unknown period. Just something to be aware of, although lots of folks get through these deal without this sort of delay.

First Time Buyers – What Are You Missing in Your Home Search?

Posted in Due Diligence,House Hunting,Short Sales,What do I Buy? by Jeff Dowler on July 21, 2009
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Believe it or not you may be missing some things in your home search.

This is especially true if your interest, or budget, puts you in front of a lot of short sale and REO (foreclosure or bank-owned) homes.

And it may not be what you think.

Read more about buying a short sale or REO – What Am I Missing?

Short Sale vs. Foreclosure Sale vs. REO

money_house.jpgThere is lots of interest in properties that are commonly called distressed properties, as well as concern about the number of these that keep appearing on the market.

Sometimes there is confusion about what these different properties are. So here is a BRIEF description.

SHORT SALE – when the home owner owes more than the home is worth and is in a hardship situation financially where a sale must happen (loss of job, divorce, etc.). Just because a seller WANTS to sell does not mean the lender(s) will approve, and a hardship must be demonstrated and documented.

FORECLOSURE – once a homeowner reaches a point where s/he cannot pay the mortgage and (normally) is behind 3 payments, a NOTICE OF DEFAULT (NOD) is filed by the lender. Often an owner already has the home on the market as a short sale. Foreclosure proceedings vary from state to state.

REO – Real estate owned properties (also commonly called bank owned properties). If a foreclosure property does not sell, it may be auctioned off (e.g., a trustee’s sale here in CA). If it is not bought then, the house becomes an REO that is “owned by the bank” and sold BY the bank on the open market.