Homeowners Considered Investors

by Joe Trometer
(Michigan, USA)

The Banks have changed the rules again!

Many Bank owned homes for sale have a clause that state, "No Investors May Bid For The First Fifteen Days".

In July of 2011, I bid full asking price on a Bank owned home for sale. My intent was to occupy this home!

My full price offer was rejected because I own a house.

Technically, at this point I'm living in one of my apartment houses that is registered in a Limited Liability Company (LLC).

Thus... The house I'm living in at this time is in a separate entity and not recorded in my personal name!

Still... I was rejected from being able to buy this foreclosed house the Bank was selling because I owned property.

Realtors® are now required to do a County Records Search of anyone making an offer within the first fifteen days of the original listing date, and submit that information to the Bank along with the offer.

There Were Problems With This House!

The Realtor's® listing sheet stated the sewer had a public tap to the main sewer line.
In fact, the septic tank was still connected and the Township is requiring the new buyer to install a new sewer tap to the main sanitary drain.

Warning: The listing sheet has a disclaimer that the information doesn't have to be accurate!

Buyer Beware!

True, I am an investor. But I still want to be able to buy a home for my personal residence!
I found out this house would require a minimum of Ten-Thousand Dollars to upgrade the main sewer line because I did my due-diligence and researched the property.

The house did not sell with in the first fifteen days of the listing!

My Broker resubmitted my offer in the early A.M of the sixteenth day.
I waited two day for a reply.

On the eighteenth day my Broker notified me that the house was sold to a homeowner.

Why would the Listing Agent submit my offer if the Bank already accepted an offer?

Is There Something Shady Going On?

I can't say for sure, but it sure feels like there is less than ethical practice going on!

This is the fourth house in two years I lost, where:

- My offer was the first offer submitted and rejected!
- The Bank accepted my offer, then rejected it!
- The Bank accepted my offer, then said "Multiple Offers".

I'm not accusing anyone however, Listing Agents can control the timing of when offers are submitted.

Listing Agents do get the full commission when they list and sell a property. The Listing Agents split the commission fifty - fifty,
when a cooperating Buyers Agent submits an offer to the Listing Agent seller.

Maybe Everything Is Legitimate?

The last Bank owned house I successfully purchased from my Broker was listed with my Broker's office. I haven't been successful buying a house through my Broker, from other Real Estate Companies.

My Questions...

How does a first time home owner qualify for a bank owned house that needs major renovations?

Can I only be successful in buying Bank Owned Homes,
by contacting the Listing Real Estate Agent?

I have the money to buy a house without financing.
I'm finding it's very difficult to do so!

What's Your Experience?