Clean Up Time
It has been said that “real estate got us into this mess, and real estate will get us out of it.” Quite a mess indeed and, for many, it is now clean up time.
Valley home prices have risen for the fourth month in a row, and sales have been fueled by a flurry of foreclosure fix and flips and traditional buyers taking advantage of low prices, new home buyer tax credits and record-setting low mortgage rates.
Yesterday’s Wall Street Journal had an article about the return of house flipping in Phoenix and Scottsdale, highlighting the ways that a new breed of buyers are acquiring homes at foreclosure auctions using cash on hand to scoop up available properties and quickly selling them for increased margins.
For would-be buyers lacking pools of available cash, a myriad of private financing options have emerged. Private money loans often come at a higher cost than traditional financing, but are currently the only alternative for buyers that want to play in this market.
In the frenzy to make money it is critical to ensure that deals are being papered properly and that the legal formalities are being observed. Unfortunately, a great auction price suddenly loses its value when it is revealed that there are tax liens or underlying title issues.
We have been helping clients of all sizes, and on all sides of these deals, to prepare the necessary documents, perform the due diligence and take the necessary steps to ensure their deals are still being done quickly, but also with a sound legal framework.