The family down the street is selling their home. If you didn’t attend the PTA meeting or go to the church with the family chances are you don’t know this seller. Unfortunately in today’s market we do know the seller. We can bet that the seller of that house is one of the following:

• Bank of America
• Countrywide
• Freddie Mac
• Fannie Mae
• Wells Fargo
• Chase
• Washington Mutual (WaMu)

I’m sure there are countless other banks that are selling Americas housing inventory but these are the major players right now. This, in turn, has created sellers (banks) that do not know the condition of the property you want to purchase. They have no idea that there could be cement hardened in the plumbing or that there was a leak in the roof, etc. This is the major reason why banks are selling their properties “AS IS“. In California they do not have to provide a disclosure of the condition of the property. Why would they, they didn’t live in it?

Banks are selling their properties, “As is” but what does, “as is”, really mean?

• Does it mean that once I make an offer I have to accept the present condition of the house?
• Does it mean that when I take a look at this house I have to sneak around and check everything before I make an offer?

This is what “As is” means:

“It means that you are purchasing this home in it’s present physical condition. The seller (bank) is selling you the house without any warranties or guarantees of its condition whatsoever. The seller (bank) will not repair or improve on anything, period.”

But does this mean that you have to purchase your prospective home blindly? The answer is NO.

Even though you are purchasing a property “As Is” you still need to know what “As is” is. Do you follow me?

This is why you should always elect to do a home inspection especially on a bank owned property where no one knew how the home was cared for and no one knows what happened right before the past owners left the property. They could have done some things that made the property unsafe or could have done damage that wiped out any profit you had calculated into the deal.

Since the banks want a quick escrow you should be prepared to throw out the custom 17 days to complete your inspections and bring it down to 10 days or sooner on your initial offer to the bank. I work with many investors here in Victorville California and the norm on home inspection periods has been 7 days and in some cases the banks have countered with 5 days to complete the home inspection.

You need to ask for this home inspection period so you can find out what the “As is” condition is of the property.  Once you are satisfied with the present condition is when you proceed with the purchase. If not, cancel!

Yes, you lose out on the cost of the home inspection but that is the price you pay for taking a bite of apple so to say.

The cost of the home inspection is well worth it considering the headache you would have had in the future trying to make the house livable. Go Watch “The Money Pit” starring Tom Hanks and Shelly Long and you’ll be making sure you know the “As is” condition of every home you purchase from now on.

Good luck in all you do America

Photo: aka Kath

This Article is Copyright © 2004-2009 BiggerPockets, Inc. All Rights Reserved.

What Does Buying a Home “As is” Really Mean??

Google has come a mighty long way regarding innovations pertaining to the World Wide Web.  They are much more than a search engine.  Thus far, I’ve divulged tips using Google applications such as Google Voice and Google Earth.

Today I’m going to focus on how you can utilize Google Maps when showcasing properties online.

These days it is typical for a property, especially one that is listed with a Realtor, to have a virtual tour of the interior of the house.  Google Maps will allow you to go one step further and create a virtual tour of the exterior of the house and it’s neighborhood.  I’ll show you how simple this is to add to your arsenal in the easy to follow steps below:

1. Go to Maps.Google.Com

2. Type in your address of the property for sale and click the “Search Maps” button.  For this example I’ll use a random house from good ole STL (1334 Brownell, Saint Louis, MO 63122), my hometown.

3. Once the search is returned, click on the red location indicator displayed on the map.

4. A pop-up menu will appear, you should have a “Street View” link available to you.  If you don’t have a “Street View” link, then this means that Google hasn’t sent their street van down that street to capture images, yet.  However, this doesn’t mean that you can’t choose a spot to showcase that Google does have imagery for in your neighborhood.  I imagine it’s not feasible for them to capture absolutely every street in the US.  That said, they do have an abundance of neighborhood imagery across the country.  (If your property’s street has no imagery, go to step 4a.)

4a. When you can’t get the street view of your house, you can drag the Street View mascot logo across your map to place him somewhere near your property, to showcase the neighborhood.  You may only drag and drop the Street View mascot onto a street that appears outlined in blue.  The Blue outlines indicate a Google-indexed street.

5. After the “Street View” link is clicked, you will be presented with the actual Street View of the property.  You can use your mouse to click around to get a panoramic idea of the property and the neighborhood as if your were standing there in person.  Below is the image for: 1334 Brownell, Saint Louis, MO 63122. You may click on the image to be taken to the actual interactive virtual tour.  Play around with this and get familiar,  you can click your way all across Saint Louis and further (just follow the arrows).

6. To find the virtual tour HTML source, once at the Street View of your property, you may click the “Link” link in the upper-right hand corner of the page.  You will then want to click the “Customize and preview embedded map” link.

7.  After clicking the “Customize and preview embedded map” link, you will be presented with 3-steps.  The First; customize the size of your Street View Map.  The Second; your preview of your map.  The Third; the raw HTML output that you can copy/paste into your MLS listing, eBay auction, blog, or even CraigsList (you will need to follow the same tutorial steps, except take a screen shot of the Street View image).  If you’d rather not embed the HTML of your virtual tour you can just grab the hyperlink.

Embed:

View Larger Map

Screenshot:

So that about wraps up another tip that can be used to give you an edge over your competitors.  Realtors, especially you should be using this extra bell/whistle to leverage your domination of the relocating-buyer niche in your market.  I broke this down so that it should be simple to follow.  If you think this is too difficult, get your kids to help you.  Or as always if you have any questions, technical or otherwise, leave a comment or hit me up at @Schwaps on Twitter and I’ll respond as soon as I can and am glad to help.

This Article is Copyright © 2004-2009 BiggerPockets, Inc. All Rights Reserved.

Google Street View: Virtual Tours your competitors don’t use

Today’s news seems to bring us a tale of opposites every time they report on the real estate market as it exists at this point in time. For example, an article by the AP just the other day said “the pace at which people fell behind on their mortgages slowed during the summer for the third quarter in a row. The bad news is the overall delinquency rate hit another record.”

I don’t know about you but a guy could go goofy if he just took what he read at face value. On the other hand, if a guy looked at these reports and decided to sift out the silver lining he could get by although be it at a slower pace.

TransUnion Adds To The Clutter

TransUnion plucked some numbers out of their database (total of 27 million consumer records per them) and said that mortgage delinquencies remain highest in the four states where the crisis has hit the worst:

• In Nevada, the rate reached 14.5 percent, up from 7.7 percent a year ago.
• In Florida, the rate was 13.3 percent, up from 7.8 percent last year.
• In Arizona, the rate hit 10.4 percent, up from 5.5 percent in 2008.
• In California, the rate jumped to 10.2 percent, from 5.8 percent last year.

TransUnion added the opinion they expect delinquencies to rise. Of the 50 States, they expect Nevada to reach 16 percent. Since I live in Nevada, I can fish for the silver lining to my heart’s content if TU is correct.

By the way, TransUnion also stated that the states with the highest delinquency and foreclosure rates will likely continue to see depressed housing prices. That sounds obvious but yet needs to be stated especially if fishing for the silver lining is your current means of finding real estate values.

Because TransUnion has a basket full of numbers, they also proffered that for the three months ended Sept. 30, 6.25 percent of U.S. mortgage loans were 60 or more days past due. According to them, that’s up 58 percent, from 3.96 percent, a year ago. Being two months behind is considered a first step toward foreclosure, because it’s so hard to catch up with payments at that point.

If that is anywhere near true, the silver lining becomes easier to find. I don’t know what that silver lining is for you in your market, but it could be a variation of the loan called a bridge loan. In this case, instead of the usual meaning of bridge loan, you make the delinquent party a loan for their two months mortgage payments. For collateral, use your imagination. Personally I wouldn’t make it the house. I’d use another object. But that’s me.

Another Time Frame

The government tells us we are climbing out of the mess. However, number crunchers like TransUnion tell us they don’t expect the figure (late payers) to start declining until the middle of 2010. Who to believe, right?

That is a good question but we do know two things must get better before mortgage delinquency rates start reversing themselves. We need the unemployment picture to improve, i.e. more of us go back to work. We also need home values to improve.

This may sound like a tall order given both are more macro than micro. On the other hand, if more of us started looking for the silver lining and get busy with our piece, maybe, just maybe, we can use the micro to manage the macro.

Photo: lamentablemente

This Article is Copyright © 2004-2009 BiggerPockets, Inc. All Rights Reserved.

Foreclosures and Mortgage Delinquencies: A Tale Of Opposites

My grandfather was born in Guayaquil Ecuador in 1906. He came to America in the 70’s and would tell me stories about his business in Ecuador exporting bananas to the United States. He loved America and all it stood for; he wouldn’t drive anything but American made cars. Chevy to be exact, lol. He stated that he got into the business when exports to America were just beginning to take off, and got into the business on the GROUND FLOOR. After getting into the banana exporting business the industry took off with the economic expansion of America after World War II. He was in the game a tad before the expansion — he was ready and poised to gather the harvest.

After the fall to the floor is always the rise to top. There’s always expansion after contraction. Makes sense right? Yes.

We all agree that we have seen the worst the real estate market has thrown at us. Home prices seem to be leveling off or rising in some local markets. Yes, I know, some are still dropping, but collectively speaking, real estate seems to be on the up.

This my friends, is the GROUND FLOOR to an exciting new real estate market. This is your chance that you have waited all your life for — the chance to purchase real estate on the ground floor. 2010 is the new GROUND FLOOR where millions will be made for those that enter into real estate investing and acquire real property.

Here is a list of all the richest people that got in on the GROUND FLOOR in their respective industries:

Bill Gates (PC Software)
Andrew Carnegie (Steel)
John D. Rockefeller (Oil)
William Henry Vanderbuilt (Railroad)
You (Real Estate)

Would you have liked to have been on the ground floor when these industries boomed? I am sure you would, as would have I. Good thing for us, we are on another Ground Floor and this time it is in Real Estate.

I want to see your name on that list of billionaires one of these days; under mine of course.

If you haven’t already done so I advise you to sign up for BiggerPockets.com. Use it wisely and ride it to the top.

Good luck in all you do America!

Photo: Wonderlane

This Article is Copyright © 2004-2009 BiggerPockets, Inc. All Rights Reserved.

Invest on the Ground Floor