| Foreclosures
All too often we hear people talking about buying BC Foreclosures because they are such a great deal. The reality is there are checks and balances in the foreclosure system and there is ample opportunity for foreclosures to attract multiple offers. The question really is; how do you buy a BC Real Estate Foreclosure?
In British Columbia the judicial sale process where the lender or all other charge holders can apply for a judicial court-ordered sale. This sale happens under the supervision of a court and it is a procedure a buyer should be familiar with before entering into any kind of a contract with a foreclosed property. An Order for Conduct of Sale allows the lender to list the property for sale with the Realtor of their choice.
Five important things to understand about Foreclosures.
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In most cases the offer will go to the courts.
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When an offer is presented in court it must be FREE of all buyer Subjects or conditions
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All Offers are written Subject to Court Approval
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All Offers agree to purchase the property "AS IS"
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You are negotiating with the lender (through the lawyer and Realtors)
Note: Offers can still be written with subjects, but all subjects must be removed before they get to court, so in most cases there is still time for inspections etc.
The flow of the offer will take this pattern before it goes to court.
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The offer is initially negotiated with the lender's lawyer and the Real Estate Agents. You are not dealing with the seller at this point. In many cases the offer could be a subject offer as it is not yet in the courts. Once the subjects are removed the offer is than able to proceed for a court date.
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Once the offer is subject free the Offer to Purchase will be sent from the listing agent (Realtor) to the lender's lawyer. The lawyer will now seek a court date for presentation of the offer to the Court.
In the Court Room
In the court room the Master may ask the Realtor about the marketing of the home, what has been done to sell the property, what kind of exposure has it had and what were the results. The Master may also have questions abut the offer itself. The Master will go on to ask if there are any other offers in the court room.
If there are competing offers in court, all parties will be asked to resubmit their final offer in a sealed envelope. The Master will then look at all the offers and choose the best price.
Note: It is always good for the buyer's to be in the court room in case they have to make changes to the contract. If they are not there they could miss out on a buying opportunity.
You should also note that the foreclosure has been marketed on the open market and there is still the possibilty of multiple offers. The awkward part of Foreclosures is waiting for the court date and still not knowing if you are going to be in multiple offers or not.
One other key point: Be very sure you are able to purchase the property the courts become unfriendly if the contract that the courts have accepted can't be completed on.
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