Remember the days when you could get a loan on a condo? Well for those of you who haven’t noticed the real estate crisis (and there are a frightening number out there), those days are long gone. I haven’t seen a realÂ condo loan in a couple of years now and a look at MLS “Solds” over the last 12 months reveals about 95% of all Orlando condo sales were classified asÂ “all-cash” transactions. The 5% of mortgage-based sales were on Fannie Mae (HomePath) approved condos which are few and far between. (They tend to go to owner-occupant buyers before investors so if you’re an investor, thenÂ it’s stillÂ 100% cash, 100% of the time, at least until the credit crunch eases).
SoÂ instead of being pre-approved for a loan, you now need to be pre-approved as a cash buyer.Â In order to proceed with an Orlando bank foreclosed condo (REO) or even a short sale, a “Proof of funds” is required. Without it, the banks will not even consider your offer (and Realtors will not even submit your offer). A proof of funds let’s the bank know that you have the liquid cash to close on the deal, and when they are getting up to a dozen offers on each foreclosed condo, they need to know that the buyer who is selected has the financial capability to complete the transaction.
In most cases, the easiest way to provide yourÂ “proof” is to print off the most recent bank statement from your online bank account. A letter from your banking institution on headed paper with your rep’s contact info will also suffice if it is correctly worded. 401K statements,Â IRA’s can also work provided it is clear that you have the ability to withdraw the funds quickly as cash.
Please understand this proof of funds is no moreÂ optional than a pre-qualification letter would be if you were looking for a loan, so if you’re shy about disclosing your financial capabilty then foreclosures are not for you. Accordingly, most Realtors will require a POF before they take you on a foreclosure tour. Lines like “Trust me I’m good for it”, or “Don’t worry about it, it’s not going to be a problem” don’t fly. Bank condoÂ foreclosures are an aggressive, highly competitive and fast moving segment of the Orlando condo market.Â You will need to be wellÂ prepared, timelyÂ andÂ focused Â in order to aquire one.
For more info on condo foreclosures / Orlando bank owned condos, call Condo Metropolis on: 407-290-3408.