Foreclosures, Not for the Faint of Heart and Not for First time Home Buyers
Home Buying Tips When Shopping in Vancouver, BC Canada
by Geraldine Santiago
AUTHOR and REALTOR
When people think of foreclosures, they equate it with ‘bargain’ or ‘cheap’. But when you are buying real estate in Vancouver BC, this isn’t necessarily so. The foreclosure process is not for the faint of heart, nor for first time home buyers.
For one thing, unlike a regular sale, chattels (appliances such as dishwashers, stoves, washers and dryers, etc. as well as window coverings) are included in the purchase price. In a foreclosure, chattels are not included at all. Previous owners can take away their appliances if they wanted to, and the new buyers will have to replace them.
In addition, there is no property condition disclosure statement (PCDS) attached to the sale of the property. In a regular sale, buyers can be assured that there is some type of recourse if there was any misrepresentation or warranties that were not honoured. This means that the buyers acknowledge that there are no warranties expressed or implied regarding the property.
Also, in a regular sale, the property will be in the same condition upon possession as it was during the viewing. In a
foreclosure, the buyer is accepting the premises on an ‘as is, where is’ basis on completion of the sale.
Furthermore, a first time home buyer may avail of ‘no down payment programs’ when purchasing a home. This is not the case with a foreclosed property. A buyer of a foreclosed property should have 5% at the very least as a down payment.
In a regular sale of a property, the offer and acceptance with the buyer and seller can take place relatively quickly. However, foreclosures in Vancouver BC oftentimes experience competing bids which are sealed and subject to court approval. This can be a long process where buyers are not only waiting for the paperwork and process to take its course, but also a process that might be more costly than buyers think.
The process of a foreclosed property is one that is not for the faint of heart, nor for first time home buyers, especially when purchasing in Vancouver BC.
Foreclosures in Vancouver, BC
By Geraldine Santiago
www.vancouverhomes.info
For many, the word foreclosure conjures up ‘bargain’ or ‘cheap’ to real estate. However, when it comes to buying real estate in Vancouver British Columbia, where the price of real estate is still hot, it isn’t all that cheap!
Foreclosure happens after the owner of a property has missed months of mortgage payments. If the foreclosure happens because of personal hardship like a divorce, death, illness, job loss, versus a problem with the property itself, a buyer may be able to get a better price on the property.
However, foreclosure also happens if there is a problem with the property. In British Columbia, many home owners have experienced financial hardship due to the ‘leaky condo syndrome’ which still persists today. Many people who own a leaky condo today are not able to sell their property because of a future assessment for which the owners cannot pay. No lending institution will want the risk of such a property and so the property remains unsold. What buyer would want to purchase such a risky investment?
In addition, the foreclosed property might have been a grow-op or a crack house at one point or another. These types of property can be problematic to the average home buyer. Unless you know the risks, you might want to stay away for the time being. Fixing up a property such as this is costly and tearing the entire house down and rebuilding is even more costly!
If you are thinking of buying a foreclosed property, you might want to think again!