I heard a story Monday on NPR about a court ruling that could cool the waters on people looking to buy foreclosed homes. There were doomsday predictions that this could hurt the economy, etc. I don't care. I'm still raw from our experience of trying to purchase a bank-owned property.
After being able to sell our home quickly in Texas, we mistakenly thought we would have an easy time buying a house. It's a buyer's market, right?
The housing market in our small Texas town and Colorado Springs were drastically different. Our need for location and price range, of course, played a crucial role in our search area. We were disappointed by what we quickly began calling Legoland. No disrespect to the toy, but we were sort of shocked at the uniformity of houses and communities.
After the initial shock (a few weeks of looking at houses and not liking them), we embraced a key element of the uniformity. We could look at dozens of a floor plan we liked in a multiple locations. We eventually, settled on a short sale; but continued to look.
Then, we found a house with everything we were looking for. It was a VA-bank owned property. We outbid (yes, we were in a competitive situation) another couple and planned to close in less than a month.
During the title work, a problem arose about a typographical error. It was corrected after the home was initially sold. It was not corrected during the foreclosure process. And, we thought everything was in line to have it corrected by our closing date. Repairs required by the appraiser were completed a day or so before the closing. We were ready to own the house.
The VA had a different game plan. Apparently, they never intended to close on the date we agreed in our contract. In fact, they weren't sure about that typo either. We received a call 30 minutes before our scheduled closing. Yes, that is minutes.
We played the what if or maybe game for the two weeks. We contacted our Congressman's office seeking help to purchase the home. We were trying to purchase a government owned property and we asked: Does the government want to sell it? We discussed legal ramifications and title policy provisions.
We tallied up the expenses for the home already paid including bank appraisals, house inspections, and radon tests. We also ordered a location drawing for the property to make sure the property lines and fences were in the correct place. We scrambled to figure out what to do about the appliances we purchased for the home. Like most foreclosures, it was stripped of appliances and fixtures. We also had to spend two extra weeks in a hotel and pay to have our belongings remain in storage.
We would not have spent a dime on this house or invested our time had we known it wasn't really available for purchase. We were reimbursed for about $1,100 of the expenses. We were not reimbursed for our lost time — about nine weeks, if you count the additional time it took us to find and move into a home — our frustration or our anxiety.
I hate to think what might have happened had we bought it and invested our time and money into it. What if the previous owners had come back, claiming they were illegally foreclosed upon? Would they own the house or would we?
I don't like to be bitter, but will admit the attempt to buy a bank-owned house was a rough experience financially and emotionally for me. I don't encourage others to buy a foreclosure property. I have a very specific reason for this. While many people are able to buy foreclosed homes and get good deals, that was not our story.
We eventually found another home. We're happy. Life goes on and we won't be in the market for a new house for a long time.