If you are currently looking to buy Eastern Shore/Mobile AL real estate, you probably have a good idea of the general range you can expect to spend on a home. So you might be surprised when a great-looking home shows up on the MLS with what seems like a shockingly low price tag attached. The extra-low price seems too good to be true and – most of the time – it is.
In many cases, the price you are seeing does not represent the actual asking price of the property. Rather, it is likely a property that is in “pre-foreclosure” and the amount listed actually represents the balance of the defaulted loan, or the amount the current owner is in arrears. Below is an excerpt from an article I found at Inman News that does a great job explaining how these properties end up on MLS search engines, and what you can do to spot them:
Real estate agents, investors and sophisticated buyers will know that it’s impossible to buy a house in Hermosa Beach for $4,712. But first-time home buyers may miss the fine print on sites like Yahoo and Trulia that explains that this is not the home’s listing price — and that the property may not even be for sale.
The practice of mixing pre-foreclosure properties with listings of for-sale properties by major listings sites like Yahoo Real Estate and Trulia is misleading to consumers and damages the credibility of the sites that allow it, according to a company that’s in the business of supplying similar information itself.
Brad Geisen, founder and CEO of Foreclosures.com, singled out Yahoo Real Estate and Trulia — which have partnerships with Foreclosure.com’s rival, RealtyTrac — as sites that are presenting pre-foreclosure data to consumers in a potentially confusing way.
Property searches conducted by Inman News show both sites provide information that could help consumers understand that the pre-foreclosure properties are not “listings,” and that the dollar figures displayed with each are not asking prices. But there does appear to be potential for confusion.
Checking “foreclosures” under “listing type” and entering a maximum value of $100,000 in the “price” field, a Yahoo Real Estate search for properties in Hermosa Beach, Calif., turned up seven properties, accompanied by dollar figures ranging from $4,712 to $100,000. According to Yahoo, the median asking price for 34 homes on the market in Hermosa Beach is $1.29 million.
But click on any of the properties for more details, and you are given a “property description” that reveals — for the first time — that the dollar figures associated with each property in the search results is not the asking price. Although “price” was specified in the query, the numbers may represent “estimated loan balance” or another figure related to the borrower’s indebtedness.
The moral of the story here is two-fold; first, be sure to always read the fine print and don’t trust everything you see on the Internet and, second, always consult with an experienced Realtor who can help you determine the legitimate value of a property and assist you in finding the home of your dreams.