Foreclosures, Portland, OR | Short Sales, Foreclosures, Portland, OR

Buyers Guide to Foreclosures

1. Property Condition. Most bank-owned properties – this is true for Portland, OR, or anywhere else – are sold “As Is”. As a result, buyers assume the risk of most property condition defects that may not be discovered until after closing. Even if the buyer discovers a defect in the inspection, many times the bank will not consider paying for any repairs.

2. Buyer financing. The buyer’s lender may require that the property to be repaired (e.g. a new roof) as a requirement of the buyer’s new loan. As stated above, this cost will fall on the buyer since the bank that owns the property has little incentive to pay for repairs. For condominiums, the buyer may have to come up with money to replenish Association reserve accounts.

3. No Property Disclosure Statement. Banks that acquire property through foreclosure or deed in lieu, are generally exempt from providing a Seller’s Property Disclosure Statement.

4. Length of Time to Negotiate the Offer. Banks are not typical sellers: they may be in a different time zone and they are usually closed on weekends. They are overwhelmed and it may take days or weeks to respond to the buyer’s offer. Further, there can be little sense of urgency to respond, especially if the buyer’s offer price is not at or near the price the lender expects to receive.

5. Onerous Terms. The bank will provide their own addendum to the Purchase Agreement that will contain non-standard terms and conditions that are mostly unfavorable to the buyer. This may require the buyer to engage a lawyer to review the forms adding time and cost to the transaction.

6. Inspections. Since the buyer is likely purchasing “As-Is”, inspections are critical and sometimes it makes sense to have more than one inspection. This can increase the buyer’s costs.

7. Earnest Money. Some banks are requiring a larger earnest money deposit that would a typical seller. The bank may also require the buyer to make the deposit even before the bank accepts the offer.

Please contact us to learn more about our expertise in short sales and foreclosures, or to schedule a showing of any listing seen in our Portland, Oregon Area Search Tool.

We’d love to work with you!

Michelle

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