In two recent postings I talked about two Category 3 nightmare stories. St. Paul REO Nightmare...don't let this happen to you back in February and earlier this month St. Paul REO Nightmare #2 .

 

 

The City of St. Paul has 1962 registered vacant buildings as of 4/20/09 and of these 1377 are Category 2 vacant buildings.  For a Registered Vacant Category 2 building the seller or buyer must complete and submit the Vacant Building Registration form, pay outstanding fees – the annual vacant building fee is $1,000 and it must show as paid on the HUD 1 statement upon closing, obtain a code compliance report – note the report is only good for one year and if the building has more than three units then you need a Fire team inspection report,  a bid from a state licensed general contractor must be submitted for approval, a signed statement from the owner showing a date and timeline for the completion of all the code compliance work, and submit proof of financial capability.

It's important to understand at the Department of Safety and Inspections (DSI) Jeff and Reid are very particular on these requirements and the more organized and thorough you are in delivering these items the better off you will be. These gentlemen are very busy and they will not tolerate any incomplete files.  The contractor bid should include total costs for each of the four categories for repairs: Building, Electrical, Plumbing and Heating.  The bid must absolutely state that all code compliance work orders are covered in this bid and will be repaired accordingly. When showing proof of funds they will accept evidence that the repair costs are included in the mortgage, a construction loan statement or a bank statement along with a signed notarized statement from the buyer indicating that the funds shown will be used to complete the code repairs required.

 

REO's, bank owned and generally all lender mediated transactions have become common place here in the Twin Cites. However, still all too often a buyer does not have representation and takes on a huge risk by not working with an agent. BUYER BEWARE - these transactions are becoming more and more complicated. Get representation on these deals and make sure you work with an agent that is familiar with REO transactions so you don't get stuck buying a property the city won't let you repair.  

PR: wait...  I: wait...  L: wait...  LD: wait...  I: wait... wait...  Rank: wait...  Traffic: wait...  Price: wait...  C: wait...