Friday, December 19, 2014

Housing market bouncing back as foreclosures drop

By ABBY ECKEL, Herald Staff Writer | 12/18/2013

Tighter lending practices might be behind the recent drop in foreclosed homes, Sharon Bollin said.

At the end of November, 734,205 U.S. homes were in some stage of the foreclosure process, down 24 percent from a year earlier, according to npr.org.

Tighter lending practices might be behind the recent drop in foreclosed homes, Sharon Bollin said.

At the end of November, 734,205 U.S. homes were in some stage of the foreclosure process, down 24 percent from a year earlier, according to npr.org.

“Getting a [home] loan has tightened up,” Bollin, vice president and mortgage loan manager at Arvest Bank, 119 E. Third St., Ottawa, said. “Most lenders have tightened up on the approval process. More documentation is needed to be verified, depending on the customer’s situation, and that is due to all of the hard hits taken to the housing market over the last few years.”

Foreclosed homes can be a blessing for those looking for a house, Bollin said, and the foreclosed homes in decent shape are being snatched up quickly by buyers or investors.

“The economy has picked up, and I think that allows those with cash resources to buy those [foreclosed homes] that are not in the best shape,” Bollin said. “Folks struggling awhile back are basically coming back with income and employment, and that’s allowing them to buy homes. The foreclosure homes in decent shape are being bought and the ones that aren’t [in decent shape] are being bought by those who have the ability to buy them now.”

Just because a potential buyer gets approved for a certain amount of money, doesn’t necessarily mean they can purchase a foreclosed home, Tammy Ellis said.

“Foreclosed homes are sold as-is in present condition and what you see is what you get,” Ellis, associate broker at Century 21 Lantis and Associates, 2141 S. Princeton St., Ottawa, said. “If people say, ‘Well I’ve got  a rural development loan and I’m approved up to $50,000. I want to buy a foreclosure,’ it won’t work because the house is being sold as-is and the loan may dictate that the house doesn’t qualify for that loan.”

The number of current active listings for all homes in Franklin County is 186, Ellis said, but figuring out how many of those are foreclosed is near impossible.

“A couple months ago when you would input a listing you would have to say if it’s a repossession,” Ellis said. “But prior to that, you didn’t have to and you don’t have to fix your listings to be listed as a repossession.”

Those buyers with cash on-hand or whose loan will allow them to buy a foreclosed home can get a pretty good deal on them, Bollin said.

“Foreclosed homes sell at better prices than normal listings because usually the bank is taking a loss on the property because the homeowner walked away from the loan,” Bollin said. “The bank is going to try and sell it for what they can get out of it to keep them from having to take an even larger loss on it.”

A neighborhood chock-full of foreclosed homes isn’t good for a seller whose home isn’t foreclosed, Bollin said, but rather is being listed as a normal listing.

“It’s nice not having a lot of foreclosed homes around on the market that can be looked at as comparables on pricing for the house being sold,” she said. “Usually an appraiser stays away from putting foreclosure on the appraisal, but they do take into account how many [foreclosed homes] are in the neighborhood.”

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