I’m going to share with you some vital information about foreclosures that isn’t being talked about and I will have to be somewhat cryptic and not mention any names to prevent any blowback or legal attacks.
My first encounter with the dirty little secret about foreclosures was in March 2009 but at the time I didn’t know this was as widespread as it was.
I had a client who had contracted to buy a house in Largo that was a foreclosure and we did the inspections. The inspector found some obvious issues like wood floors needing to be refinished and missing kitchen appliances as well as some less obvious issues like A/C ducting needing to be replaced because of rats chewing through it. He also saw that there were gaps between the crown molding and the ceiling in the back of the house. Someone had already done some caulking to fill in the gaps but there were noticeable gaps between the caulking and ceiling. After looking at it very carefully he told my client that it appeared to be coming from settlement issues in the back of the house on that side.
My client cancelled the contract and we both noticed that none of the information we provided from the inspection was disclosed when the house was made Active again in the MLS.
Then about a year or two ago I started looking into what was involved in being a listing agent for lenders and Fannie Mae for their foreclosed properties. I knew that it would increase my business and that I could do a good job – but as I looked into it further I discovered some unsettling info. There were agents who posted to forums online that they got out of the business of doing foreclosure listings because they were being told to do things that could cause them to lose their licenses. Specifically, they were told that if they received any reports on a property that stated there were any issues with that property they were delete those reports from their computer.
This would be in direct violation of one of the specific requirements for a real estate agent which is that they have to “disclose any known fact that materially affects the value of the property” and I was not willing to do that or put myself in that situation so I never jumped on the gravy train of foreclosure listings.
This summer I had 2 buyers who went under contract on foreclosed homes and saw that there is actually a culture of concealment and deception in the foreclosed property sales field which reminds me of how politicians operate and which harms buyers without their knowledge.
Read about their stories (the 2nd one is even more appalling than the 1st) and what I’m recommending to my clients now about buying foreclosures: