Posts Tagged ‘bank owned homes’

Can A Seller REALLY Enforce That The Buyer Not Resell For A Specific Period Of Time?

A lot of the bank and government owned listings specify owner occupied only for the first couple weeks or for the first month. They require the buyer to sign a document that the house will be their primary residence and that they can’t sell for the first 60 days up to a year after closing.

What law is the buyer breaking if they lie? I never realized it was against the law for buyers and sellers to lie to each other. They do it all the time- “I can’t go below X on my price.” Or “X it the very top I can afford.”

I spoke to the listing agent today of a HUD listing for a buyer who wants it as a 2nd home- her lake home. The agent told me she would have to claim it as her primary residence for the first year and change her driver’s license.

Is this enforceable? Is it legal? Once the transaction is completed the seller no longer has any interest in the home.

I’m not an attorney and don’t want to become a test case. But I am curious if anybody has heard of a bank or the government going after a buyer after they didn’t move in or if they sell too early.

Jackie Hawley

ReMax Encore, Clarkston




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Michigan Foreclosures- New Buyer Fee to Consider

It is customary in Michigan real estate transactions for the seller to pay the transfer tax- both state and county- to the tune of .86 of a per cent of the sale price. Bank owned homes backed by Fannie Mae and Freddie Mac have been exempt from this fee until now. Fannie and Freddie are refusing to pay this fee and passing it on to the buyer and this includes sales that are currently pending.

A little background:

Up until now Freddie and Fannie have been exempt from this cost which is not exactly a puny little fee. For every $100,000 of house that is an $860 charge. There has always (probably not literally always) been a clause in the addendum to purchase Fannie and Freddie homes stating “Seller is exempt from payment of state taxes and tax stamps on deeds, mortgages and notes (12 U.S.C 1452(e)) and if payment of such state taxes or stamps is necessary to record the deed or mortgage, the tax will be paid by Purchaser and will not be considered part of closing costs.”

When representing the buyer we have just told them to not worry- Freddie and Fannie are exempt in Michigan, so go ahead and sign if they want the house. Unfortunately on bank or government homes (foreclosures) there is no changing or tossing their addenda. They have standard forms and they don’t deviate.

I personally never felt it was right to exempt Fannie and Freddie from paying the transfer taxes; it’s not like our state is so flush we don’t need the revenue. And if we want to exempt anybody, why not exempt people instead of a quasi-governmental agency which is organized as a privately owned corporation that issues its own common stock? Or stated another way- a private company when it comes to profits and a government agency when they need money.

The change in Michigan Law, or the interpretation of current law, I have no argument with. I have a problem with the cost applying to currently pending sales and with the addendum that states that the transfer tax can’t be considered a closing cost.

The bottom line:

When considering a foreclosure listing, discuss any additional fees with your Realtor regarding that specific home. Fannie and Freddie homes now have close to an additional per cent in fees that other listings don’t have. The last PNC owned listing I sold the buyers had to pay $300 fee plus were required to use the seller’s title company for the lender’s policy (which is probably illegal but if you want the house….). Other banks have their own fees that get passed on to the buyer. Many foreclosure agents have added required buyer fees in order to present an offer.

Often times a regular, non-distressed sale is truly the best “deal” once you consider additional buyer fees, the fact you may need to have utilities in your name in order to have a home inspection, the fact you may have to pay to un-winterize a house in order to inspect, the fact that there are probably obvious issues with the house and probably hidden problems you may not discover in a home inspection.

Are Bank Owned Homes Really the Best Deal?

More About Buying Foreclosed Homes

Jackie Hawley
Keller Williams Realty, Clarkston MI

Cell: (248) 736-6407

E-mail: Jackie@JackieHawley.com 

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Are Southeast MI Foreclosure Sales (Bank Owned Homes) REALLY The Best Deals?

buying a bank owned or foreclosure fixerSometimes they are. Some bank owned homes are in pristine condition. Sometimes. Most of the time they are rough. Often times they are not mortgageable. Often times once you pay cash (money that is not making money elsewhere) and then you put cash into the house to make it livable you end up with a nice house with the same amount of money into it as the regular or non distressed sale you passed up because it “cost more.”


Some of what you need to consider before ruling out non-distressed homes:

  • What type of mortgage do you qualify for or do you have all cash?
  • Will you have the cash after the purchase to complete the repairs?
  • Are you going to use a builder or do the work yourself and are you ready to disclose at re-sale that you did all or most of the work yourself?
  • What dollar value do you put on your time?

If you are getting a conventional mortgage remember the house will need to have a working central heating system and running water. Don’t bother looking at a house where the kitchen was removed.

If you are an FHA buyer the house needs to be in decent shape- livable.

If you are an FHA 203K buyer you will be able to finance the repairs, BUT you will need a licensed builder to draw the money for the repairs. If you are paying a builder, are you really any farther ahead than buying a home that has been maintained?

I’m not saying that fixers are necessarily bad, but too many consumers today seem to think there is all this sweat equity to be made on buying distressed properties and for the most part that is simply not true.

Do You Really Want to Buy a Fixer?

The Perfect House- Does it Exist?

How to Figure Your New Property Tax

A Tale of Two Taxes- How Property Taxes Affect Your Buying Power

Jackie Hawley
Keller Williams Realty, Clarkston MI

cell: (248)736-6407



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Buying a Forelcosure Home in Southeast Michigan

Like with my short sale posts, I still haven’t organized my categories or tags for my foreclosure articles. So in the meantime I figured I’d cheat a bit and paste the links all in one post.


Why an Oakland County Michigan Foreclosure Listing May Not be The Best “Deal”

The Foreclosure Process in Southeast Michigan

Oakland County Michigan Home Buyer- Find a Foreclosure Listing You Want? Jump on It!

Oakland County Michigan Foreclosure Listings are NOT Available for Sale BEFORE Hitting the MLS

Southeast Michigan Foreclosure- Misconception #1

Highest and Best are NOT Synonyms

Contingent Offers on Distressed Sale Homes

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lying rat media

lying rat media

Lake Orion Michigan 3rd Quarter Home Sales- Cold Hard Facts Refute Media Reports Regarding Foreclosures. Which is a fairly nice way of stating that, again, the main stream media is full of shit and spreading alarmist and untruthful information regarding the state of housing sales. I kept hearing all day how foreclosures in Michigan are not only up for the 3rd quarter compared to the 3rd quarter of 2009; I was hearing reports about how foreclosures in Michigan were hitting record highs.

First of all, at least one of the sources quoted counts foreclosure notices as a foreclosure. Many of those houses will never go to foreclosure sale. Secondly, you can’t take Detroit statistics and claim that is reflective of the rest of the state. The way I was raised this is the same as lying. If you are of a more forgiving nature this is at a minimum misleading.

You need to look at individual communities to gage the recovery of the real estate market. This blog post will discuss the sales trends for Lake Orion Michigan– both the township and the Village.

The facts are:

Lake Orion Michigan unit sales for the 3rd quarter of 2010 were down from last year but are still up over last year through the first 3 quarters.

The Lake Orion Michigan median sale price for the 3rd quarter of 2010 was up 12.8% – $158,250 vs $138,000 in 2009.

The median monthly sale price in Lake Orion Michigan was up over last year for the last 5 months in a row and 6 of the past 9 months. 

lake orion michigan monthly median sale prices

2010=yellow 2009=blue

There were 27 foreclosure sales in the 3rd quarter of 2010 (or 33% of total sales) vs 56 foreclosure sales for the same period in 2009 (or 46% of total 3rd quarter sales).

Short sales made up 22% of total sales for the 3rd quarter of 2010 and only 4% of total 3rd quarter sales in 2009. The decrease in foreclosure sales and increase in short sales are probably a huge factor in the increase in median sale price.

Also the decrease in inventory is a contributing factor for the increase in sales price.all is not rosy in the lake orion michigan housing market

All is not rosy in the Lake Orion Michigan housing market, but it is much better than the media would have you believe. Have we hit rock bottom? Who knows? Only time will tell; we won’t know where the bottom is until we’ve passed it. But facts are facts and the bilge the media has been spewing is far from factual.

Lake Orion Michigan Detailed Sales Data

Neighborhood Sales Data

Lakefront Sales Data by Lake   

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Is This a Trend? Clarkston Michigan Sales are Up AGAIN!

Let’s hope it is. The past couple days I wrote similar posts for Lake Orion and Oxford. And today I’m happy to write that sales are up, AGAIN, in Clarkston Michigan. The median sales price was up for the first half of the year, up through the end of August, and up for the past 4 months in a row. Unit sales are also up and total sales volume for Clarkston Michigan homes is also up from last year.

clarkston michigan home sales

in the graph above the pink line is for 2010 and the blue line is for 2009

In fact- unit sales through August 2010 are up from 2009, 2008 and 2007. Even though unit sales are up, bank owned sales are down from 2009- 95 bank owned sales though August 2010. 101 bank owned sales through August 2009.

Median Sales Price:
2010: $157,450
2009: $142,000

Units Sold:
2010: 268
2009: 209

Total Sales Volume:
2010: $48,227,480
2009: $$37,348,470

Bank Owned Sales:
2010: 95 units or 35.4% of total sales
2009: 101 units or 48.3% of total sales

Short Sales:
2010: 64 units or 23.9% of total sales
2009: 27 units or 12.9% of total sales

As of 9/18/2010 there were 223 total listings for sale in Clarkston Michigan with a median asking price of $217,000. On 9/28/2009 there were 258 homes for sale with a median asking price of $239,450.

For more detailed information about a particular house or neighborhood a market analysis would need to be done for that specific home. Below are links to some pages where I’ve been compiling information (including sales data) for specific subdivisions and lakes (for lakefront homes). The above numbers are averages for Clarkston Michigan/Independence Township with some additional date to help interpret the data. The more specific the geographic area, the more one can glean from the data.

 North Oakland County Michigan Neighborhoods

North Oakland County Michigan Lakefront Homes for Sale

Search the MLS

Clarkston Michigan Homes for Sale

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It’s no big secret that Michigan residents in general have been going through some rough economic times. I say in general, because not everybody is hurting. But with unemployment/underemployment at 20% or more many Michiganders have felt a financial pinch.

Some of that financial pinch shows in many of the houses that have sold in the past few years. Not as well maintained and some foreclosures are downright destroyed. For those who have taken advantage of our buyers’ market, you will more than likely need/want to make repairs and improvements on those homes. And while making those repairs and improvements you may want to consider the fact that the cost of energy has been on the increase with no end in site at this time. Personally, my electric use is down, but my electric bill is higher than for the same period last year.

We can only tackle the cost of power itself with constant contact with Congress people (Cap and Trade, etc) and in the voting booth this fall. But we DO have some control on the amount of electricity and gas we use and get some of our tax dollars back in the process via tax credits and rebates.

There are Federal tax credits that don’t expire until 2016 for items such as Geothermal Heat Pumps, Residential Wind Turbines and Solar Energy Systems- 30% of cost with no upper limit.

And there are Federal tax credits that expire December 31, 2010 for 30% of the cost up to $1500 for items such as “biomass stoves” known to the rest of us as wood stoves (or corn, or pellets), central air, heating, water heaters, insulation, windows, doors, and roofing. You should go to the federal government web site for details and exclusions and consult with your accountant before purchasing anything.

Not covered are items like ceiling fans, CFL’s- those swirly light bulbs made in China (the last American light bulb factory just closed down), toilets, electric furnaces/boilers (like we all have natural gas available), clothes washers and dryers….

You state may have it’s own credits or rebates. Some of the rebates for the state of Michigan have run out of money (but there is sill money in the budget to promote breast feeding), but there is still some money left for the purchase of refrigerators, clothes washers and dishwashers. Check this web site for details.

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