Everyone is familiar with the current economic situation and the still dynamic real estate market here in Idaho. Whether you live in Boise, Nampa, or the fast growing Meridian area, there are fewer homes for sale now than in years past. And many people are concerned about their home mortgage being “upside down” and/or the possibility of foreclosure even though the market has bounced back. Some people who can make their mortgage payments are considering a so-called “strategic foreclosure” with the hope that turning over their home to the bank will mean less financial pain in the long run. Others contemplate short-sales or deeds in lieu of foreclosure and want to know if such may be their best option.
If you are facing any of these issues, contact Lerma Grover Law to discuss the different considerations that you need to keep in mind. A partial list includes: How much equity do you have in the property? Are your economic struggles temporary or is there “no end in sight?” Is too much income tied up in housing costs? How will your credit be affected? Could you be subject to a potential deficiency judgment? Are there second or third mortgages on the property—and if so, what effect might those have? What are the potential tax consequences? Can the homeowner handle the emotions and stress that frequently arise from these issues?
No one will have all the answers—but a homeowner needs to be as fully informed as possible. Much of the necessary information may come from the mortgage holder. And realtors or accountants may also have useful insight. But it is also important to consult an attorney to discuss some of these issues so as to make an informed decision. We cannot provide the ultimate answer, but we can focus you on some important items that should be considered when dealing with these difficult issues.
There are also issues with purchasing homes that have been through foreclosure. The price may be lower than other houses on the market for good reason. Since no one recently lived in the home, no one will know of existing problems with the property. You may have to investigate the property by asking the neighbors about the state of the home and what they have seen. Be sure to have the property carefully inspected so you know exactly what you are dealing with. Occasionally, the buyer will need to hire a licensed contract to fix problems that have been left unattended. There may have been modifications done to the home without having the proper permits. Repairs can be time consuming and costly.
The purchasing process can also drag on because lenders may not want to finance a property with significant problems or when the appraisal is below the purchase price. Additional paperwork and delays in communicating offers and counter offers are common. There is also increases competition from investors looking to flip homes or use them as rental properties. They tend to make cash offers that have fewer conditions and faster closings which is more enticing to the bank than your offer may appear.
Whether you need help regarding you own foreclosure or need assistance regarding a possible purchase, the lawyers at Lerma Grover law can help you with your real estate questions.