As any experienced agent will tell you, working with preforeclosures can a tricky business. Your client is in a difficult financial situation and likely to be under enormous pressure, so you need to use all the tact and sensitivity you have at your disposal. People in dire circumstances tend to be anxious to get out of them, they may not be entirely forthcoming about anything that could make their property a less attractive prospect – it is up to you to get the full story and make sure you know how to price their home correctly. Make sure you know enough in the following three areas:
Ask your client about the outstanding balance of the loan and any liens on the property, but don’t leave it there. Do your homework and head over to the public records office to check for yourself. Remember to subtract this amount, as well as any insurance costs, from your valuation of the property so that you have an accurate figure.
The upkeep of any building costs money, and if a homeowner is being foreclosed upon, chances are they haven’t had a lot of cash lying around to make basic or even essential repairs upon their property for quite a while. Make a thorough inspection of the property, keeping careful note of any repairs that a potential buyer would need to make. You could even bring along a contractor to help you make estimates of the likely costs. Like the overheads, these necessary repairs will affect your bottom line.
#3: The Devil’s in the Details
Get to know your client’s situation. This is a basic part of any realtor-client relationship, but it becomes even more essential when working with preforeclosures. What are your client’s current circumstances? How did they end up in the position of defaulting on their loan? What steps have they taken and, more crucially, are they taking any steps to remedy the situation? Being properly informed will protect you from being hit with any unpleasant surprises down the line.
Above all, remember to be sensitive. Your client is in trouble, but with a thoughtful approach, you can turn their preforeclosure to both your advantage.