The three most popular types of distressed sales in real estate are Short Sales, Foreclosures and Estate Sales. They are all distressed sales but are very different. Here are the differences in a nut shell ……
Buyer’s Realtor deals directly with the sellers Realtor. Seller’s Realtor works directly with the seller & seller’s mortgage company and or seller’s attorney. A Short Sale is the sale of a home when sales proceeds do not fully pay off the existing loan(s) and lender(s) accepts a discounted payoff to fully satisfy the loan. The best part, the existing lender pays virtually all sales costs, including commissions, escrow and title fees and repair costs. The borrower gets their home sold, the loan(s) paid off and they avoid foreclosure. Purchasing a Short Sale usually takes between 2 and 4 months. CLICK HERE FOR MORE INFO ON THE SHORT SALE PROCESS
The definition of a foreclosed property is “the process of taking possession of a mortgaged property as a result of someone’s failure to keep up mortgage payments.” With a foreclosure the buyer’s Realtor will deal directly with the bank’s Realtor. Unlike a Short Sale where the Realtors deal directly with the seller, with a foreclosure the bank has taken over the property and Realtors deal directly with them. Purchasing a foreclosure is much faster than a Short Sale. The bank will usually request settlement in 30 days with a cash deal and 45 days if the buyer is taking out a mortgage.
The most common reason for an estate sale is the death of the property owner, and the consequent need to quickly liquidate the deceased’s belongings. The survivors may have no interest in the property left by the deceased and therefore put the property up for sale. Buyer’s Realtor deals directly with the deceased property owner’s surviving relative’s Realtor. Estate sales are usually priced under market value because the family is looking for a quick sale.
As with most real estate deals, buyer’s need three things to make an offer on a distressed property. A contract of sale prepared by their Realtor, a copy of the buyer’s good faith deposit (can range from $1000 to $10,000 depending on the sales price) and a pre-qualification letter from the buyer’s mortgage company or proof of cash if the buyer is paying cash.
The Island of Brigantine Beach, NJ has a small selection of distressed properties for sale. As of this writing, 2 foreclosures, 32 short sales & about 5 estate sales. All can be viewed at www.BrigantineRealEstate.com
Revel is kicking off summer at the Jersey Shore with another awesome firework show titled Summer of Revelation Celebration on Friday, June 14th. The display will be featured by Grucci, one of the top names in fireworks. Best views will be from Revel Beach, the Atlantic City Boardwalk and the south end Brigantine beaches such as the Jetty and the Cove.
Margaritaville (in front of Resorts Casino on the Boardwalk) is putting on a free beach concert on Saturday. Musicians Andy Grammer, Mac McAnally and Wilson Phillips are scheduled to perform between 1 p.m. and 9 p.m. Jimmy Buffett is scheduled to make his special appearance at 4 p.m.
While you’re in town be sure to check out the sand sculptures from the World Championship of Sand Sculpting Contest taking place next to the Pier Shops.
See ya there!!
Bradford Pear trees are in full bloom here in Brigantine Beach. Brigantine residents are especially grateful this year since most of the island’s greenery was killed by Sandy. The beautiful five petaled flowers which are abundantly produced in the spring are native to China and Vietnam. They can grow up to 49-66 feet. In addition the Pink Cherry Trees survived and are in full bloom as well. Take a drive down to Brigantine Beach and experience the spring beauty that our island has to offer. And while you are here stop by Ashore Realty and say hi to our staff.
Brigantine Beach, NJ: One of the amazing aspects of this beautiful island, in late spring there is a sheer volume of turtles one can encounter. According to the Field Guide of Reptiles & Amphibians of New Jersey there are 13 species of turtles that can be found in the state. These little guys are crossing many of our streets especially the ones near the bay which explains why you will find ” Turtle Crossing ” signs through out the island. Unfortunately they are like potato chips for our hungry sea gulls and many of them wind up in the food chain before they have a chance to make it to the other side. If you happen to encounter one of these little guys please drive with caution and if needed help him to the other side. Another beautiful aspect of Brigantine Beach.
On Saturday, May 18th the City of Brigantine will be hosting its second annual 4 Wheel Drive Parade on the beach. This was a huge success last year with lots of unique and creatively themed trucks. The registration fee is $5 if paid in advance, $10 if paid on the day of the event. This gets you access on the beach and in the contest. Prizes will be given out for the most awesomely decorated vehicle! Parade starts at 2:00 PM. Route goes from 38th street to 10th street south. A bon-fire will follow at the 17th Street South beach at 8:00 PM where the winners will be announced.
On Sunday St. Georges Pub is sponsoring Brigantine’s first annual Shore-De-Tour Classic Car Show! This is taking place in the parking lot in front of St. Georges Pub (Harbor Beach Blvd). Trophies and prizes will be given out to the top 3 cars. All pre 1980 back to 1900 cars will be showcased. The show is from 8AM to 1PM with a parade down Brigantine Ave to follow. Call (609) 457-0115 for registration information.
Weekend property rentals for this event can be found at www.BrigantineRealEstate.com
More Brigantine Beach Events can be viewed here —> BRIGANTINE BEACH EVENTS
The housing market has made some great improvements in the past year and despite that there are still some great opportunities for those looking to buy, renovate and sell real estate. Short sales and foreclosures can still be found and at great prices. Before you jump into the flipping business it’s important to do your homework. Here are some tips to make your house flipping adventures successful ……
Have your Money Ready
Be sure to get pre-qualified by a mortgage company before you start looking. It’s not as easy to get a conventional mortgage today as it was 7 years ago. If you cannot get conventional financing, there are creative ways to purchase a distressed property. If the seller is not carrying a mortgage on the property it’s possible they may consider a Purchase Money Mortgage. A PMM is simply when the seller acts as the bank and holds the mortgage. Many sellers will entertain this as an option if you agree to a two or three year balloon. Because you’re flipping the property, you should be able to pay off the mortgage within a year or sooner. If you have cash to purchase the property this will not only simplify the process but will give you more negotiating power. Cash is king and always will be.
Assemble your team!
Before you get out there and start putting in offers you must assemble your team of professionals starting with a Realtor. When choosing a Realtor be sure to ask how long they’ve been in the business and if they’re real estate investors themselves. Real estate school doesn’t teach the ins and outs of a transaction. Experience is key when choosing a Realtor. You will also need to have onboard a carpenter, electrician, plumber, painter and general handyman. Get prices up front so there are no surprises.
Look for Potential
Most buyers see an old kitchen with the cabinets falling off and run for the hills. When I walk into a house with holes in the drywall, stained & smelly carpet and a kitchen that looks like it was built during & went through World War II, I look beyond the mess and notice the layout instead. The most important thing to look for when searching for a flip is a nice floor plan that would be appealing to a buyer. Drywall is cheap and depending on the size of the kitchen, cabinets are not that expensive either. Keep in mind, kitchens and flooring sells homes.
Know your Market & Do the Math
Find out what comparable properties are selling for in the area you’re looking. When figuring your improvement costs don’t forget to add one year’s taxes, insurance and water & sewer. Also, be sure to figure your closing cost when you purchase such as title insurance, survey and bank fees (if getting a mortgage from a bank). Don’t forget your closing costs when you sell such as transfer tax & Realtor commission.
Stick with a Neutral Design
Just because you’re a Ravens fan and love purple doesn’t mean everyone does. When choosing colors stick with neutral colors such as tan walls and white trim. This appeals to most buyers. Earthy colors are “in” now-a-days so stick with warm earth-tone colors. Hardwood floors are important as well as stainless steel appliances and tiled baths.
Have an Exit Strategy
When doing your numbers before making your offer, be sure to plan on a worst case scenario. Make sure there’s enough potential profit so that if you have to sell the property ASAP you can drop the asking price and sell it without losing money. This goes back to knowing your market. Know at what price you could sell the property for in a day if you had to.
- Written by Dennis Allen. Dennis is an 18 year real estate investor and 22 year Realtor in Brigantine NJ specializing in short sales and foreclosures.
This weekend is National Open House Weekend! Brigantine Island will be filled with open house signs. This is a great opportunity for buyers to casually browse the Island and walk through homes that catch their eye. Open house weekend will take place on Saturday, April 20th and Sunday, April 21st between 9:00AM and 5:00PM. Most properties are open 2 or 3 hours during this period. Open houses will be listed in the local papers and online. Here is a list of Ashore Realty open house. CLICK HERE
See ya this weekend at the shore!!