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      • Settlement >
        • Documents needed to close
        • Title Insurance
      • Home Buying
      • Home Selling
  • My Listings
  • Explore Annapolis
    • Places to visit >
      • Architecture
      • Alex Haley Memorial
      • Banneker-Douglas Museum
      • Eastport Walking Tour
      • Hammond Harwood House >
        • Pumpkin Walk
      • Lighthouses
      • Paca House & Garden
      • Maryland Inn
      • Naval Academy
      • Parks >
        • Dog Parks
        • Leon Wolfe Park
        • Quiet Waters Park
        • State Parks
      • Severnside Farm Tour
      • St Anne's Church
      • Tiffany Stained Glass
      • State capital building
      • Wall Murals >
        • Design District Murals
        • Historic, Murry Hill & Eastport
        • Others Out & About
    • Events >
      • Annapolis Cup Croquet Match
      • Art Walk
      • Boatyard Beach Bash
      • Bourbon Bowties Cigars
      • C.R.A.B Cup
      • Crab Feast
      • Puppy Plunge
      • US Powerboat Show
      • US Sailboat Show
      • Waterfowl Festival
    • Runs
    • Holidays >
      • Memorial Day
      • Labor Day
      • Halloween
      • Christmas
    • Festivals >
      • Anne Arundel County Fair
      • Art in the Park
      • Beer & Wine Festivals
      • First Sunday Arts
      • Irish Festival
      • Homestead Gardens Fall Festival
      • Kegs and Corks
      • Maryland Seafood Festival
      • Renaissance Festival
      • West Annapolis Oktoberfest
    • Markets >
      • AA County Farmers Market
      • Annapolis Summer Garden Theatre
      • AA Medical Center Farmers Market
      • Diehl's Produce
      • DNR Farmers Market >
        • Annapolis Farmers Market
      • PA Dutch Farmers Market
      • 2017 Farmers Market Guide
    • Concerts & Shows >
      • All Saints Concert
      • Annapolis Town Center Concerts
      • Fast as Lightning
      • FOQWP Summer Concert Series
      • Middletons
      • Rams Head On Stage
    • Tours >
      • Ghost Walk Tour
      • Red Trolley Tour
      • Circulator
    • Places to stay
  • Gardening
    • Composting
    • Fruits and Veggies >
      • Apples
    • Gardening Clubs
    • Native Plants
    • Insects >
      • Friends or foe
    • Trees
    • Where to buy plants
    • Butterfly Garden >
      • Butterflies in Maryland
      • Location
      • Plants for Butterflies
      • Butterfly Life Cycle
      • Monarch Butterfly
    • Spring >
      • Seed Starting
    • Summer
    • Fall >
      • Preparing your yard for winter
      • What to Plant in the Fall?
    • Winter
  • Resources
    • Important Numbers
    • Maryland History & Resources
    • Schools >
      • Annapolis Public Schools
      • Private Schools
  • Blog
All About Annapolis

In The Know

Valuable insight and information for today's homebuyer.

The Scoop On Foreclosures

10/26/2016

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Foreclosures are properties which have been taken back by a bank or an insurer after an owner stops making payments. They can be a great way to get a “good deal” in many cases, but there are certain nuances to this type of transaction that you should be on the lookout for.
 
Most of these properties are sold “as is”. What that means is that the bank who owns the property is not willing to make any repairs to the property as a condition of the sale – period. Keep in mind that many of these properties could have been in disrepair at the time of foreclosure, and have been sitting vacant for many months.
 
If you are obtaining financing for your purchase, the new lender will have the property appraised, and could and likely will require certain things to be repaired PRIOR to settlement.* Even if you, as the buyer, are willing to make the repairs yourself, you cannot make repairs to a property you do not own yet. This means you would be required to change your loan to a “Renovation loan”, or walk away from the transaction. Renovation loans can be a great way to purchase a distressed property, but the terms and costs can be different than with standard conventional or FHA loan. Often you will not know the cost or extent of the repairs needed until a full complete inspection is done by a certified inspector.
 
*Below is a list of items that could be flagged. This lists is not all inclusive, but are good examples:
  • Roof damage;
  • Termite damage;
  • Faulty plumbing/leaks/burst pipes;
  • Mold;
  • Missing appliances
 
Additionally, some banks or insurers are exempt from transfer taxes. Entities which are exempt include Fannie Mae, Freddie Mac, and VA. If the property is owned by one of these entities, this means all the transfer taxes get charged to the Buyer. This could be the difference of thousands of dollars in additional closing costs. You will want to make sure you are aware of this up front, and have accounted for the additional money that will be needed at settlement.

Holly Hart – Loan Officer, NMLS ID 219868
For more info contact 410-984-8692 or hhart@southerntrust.com

This is not a guarantee to extend consumer credit as defined by Section 1026.2 of Regulation Z.  Programs, interest rates, terms and fees are subject to change without notice.  All loans are subject to credit approval and property appraisal.  First Home Mortgage Corporation NMLS ID #71603 (www.nmlsconsumeraccess.org).  Holly Hart NMLS ID 219868

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    Author

    As a mortgage lender, Holly has been helping her customers purchase and refinance their homes for over 20 years! Whether you are a first-time homebuyer, a “move up” buyer, or even downsizing, she provides valuable information and expertise to aide you along your home buying journey.

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