Last week’s blog post highlighted How to Find Foreclosures in Minnesota so this week we are going to explain what happens when you do find a foreclosure in Minnesota that you want to put an offer on.
Foreclosures are very different than working with a traditional home seller. In this case the seller is the bank and it is all business. The bank has already lost money on the Minnesota foreclosure and will do what it can to recoup some of their costs. With that in mind it is important to prepare yourself when buying a foreclosure in Minnesota.
1. You’ve heard it before– Get Pre-Approved!
Getting pre-approved for a mortgage is a good idea whether or not you are buying a Minnesota foreclosure. A pre-approval will tell you how much home you can afford and will let your Realtors know your price range when searching for homes. While getting pre-approved is a smart idea, it is a must when putting an offer in on a Minnesota foreclosure. The majority of banks out there will not even look at your offer or consider it if you are not pre-approved. The Minnesota foreclosure process is a tough one and banks don’t want to waste their time on a potential Minnesota buyer that isn’t pre-approved to buy a home. If you are ready to buy a Minnesota foreclosure and need to get pre-approved, we can recommend local Minnesota Mortgage Brokers that have experience in working with Minnesota buyers and the Minnesota foreclosure process.
2. Experience is Key
Buying a Minnesota foreclosure can be a long and difficult process so it is crucial to work with a Minnesota Realtor that has experience with Minnesota foreclosure transactions. Your Minnesota Realtor has to have negotiating skills, education and experience in dealing with the Bank’s Realtor in putting together the best deal for you. Your Minnesota Realtor is there to look out for you and protect you against the bank that has no interest in your well being. We have personally represented hundreds of Minnesota buyers through the Minnesota foreclosure process and would love the opportunity to help you!
3. Put Your Best Foot Forward
If you find a Minnesota foreclosure that is a really good deal, you can bet you won’t be the only buyer out there that thinks so. If there is more than one buyer interested in a house there is a chance that the bank’s Realtor will present multiple offers to the bank. Multiple offers are just what they sound like– multiple purchase offers on one Minnesota home from multiple buyers. This can be 2 buyers up to an unlimited amount of buyers. How does this impact you if you are interested in buying a Minnesota foreclosure? It means if you find a Minnesota foreclosed home that you want to put an offer on, you must put your best foot forward. It could be the only chance you get to let the bank know you are serious about the home. As your Realtors, we can advise you on the best offer for the home, let you know what is realistic and what may be too high or too low of an offer. We want to make sure you are getting a great deal but we don’t want to see you overpay for a Minnesota foreclosure either!
4. Practice the Art of Patience
In a traditional sale, a buyer writes in deadlines in the purchase offer that requires the seller to respond in a certain amount of days. Typically that is about 24-48 hours. When putting an offer on a Minnesota foreclosure it can take months– not days– months to even hear back from the bank regarding your offer. The one thing you have to be prepared for when buying a Minnesota foreclosure is that you are essentially at the whim of the bank. They may respond to your offer in a week, they may take a month. This part alone can be very frustrating! As your Realtors we do everything we can to stay in touch with the bank’s Realtor to keep you up-to-date but unfortunately we are all at the bank’s beck and call. When buying a Minnesota foreclosure patience is a must!
Buying a foreclosure in Minnesota can be well worth it because of the fantastic deal you can get, but it is critical that you are prepared for the process! We hope these 4 tips help you understand the process of buying a Minnesota foreclosure better. If you are interested in searching for a Minnesota foreclosure in Woodbury, Cottage Grove, Stillwater, Lake Elmo, Washington County or the Twin Cities Metro, please contact us today. We would love to show you around!
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