Wednesday, March 30, 2011

REO HOMES: Asset Manager Malfunction


I recently closed a bank owned property in Ogden.  I am glad that the transaction finally came to a conclusion.  This one almost made me bald and gray.

The typical real estate transaction takes 30 to 40 days to complete in today's market.  Unfortunately, the transaction I am speaking of today took us 91 days.  Here is a break down of the chain of events (click to enlarge):


Our first sign of trouble is that the seller took nearly two weeks to return a contract to us with signatures on it.  This wouldn't be to big of a problem if the transaction was cash but in our instance it was a financed offer...by an owner-occupant no less.  We couldn't start working on the loan until we received the contract from the seller.

Then came the puzzling delays in receiving our transaction-dependent Own In Ogden paperwork back from the seller.  The process normally takes a day or two to submit paperwork and get it back from the other party.  In our case, we were delayed a total of 33 days (yes, over one whole month) waiting for the seller to sign and return paperwork so we could move to the next step.

My clients had expected a traditional time frame and had notified their landlord of their intent to vacate.  With these delays they had to renegotiate their lease terms and live out of boxes for two months.

The lesson to take away from this is that bank owned properties are a fantastic bargain but be prepared to wade through a bureaucratic swamp to get where you want to be. Caveat Emptor (Buyer Beware).

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