Frequently Asked Questions (FAQ)
Table of Contents
- Econohomes Credentials
Diligence and Deposits
- Can I view the inside of the home?
- Do you own the properties on your website or are you a broker?
- Why do the tax records show a registered owner of the property that is different than Econohomes?
- How can I take a property off the market?
- How long do I have for due diligence once I have put down a deposit?
- Do you accept credit cards for the deposit or down payment?
- Property Condition
- Liens and Encumbrances
- Taxes and Fees
Deed and Title
- Why do your customers buy properties from you without clear title?
- What is your closing process?
- What is your most common method of closing?
- Can I close with a title company?
- What kind of deed do you provide to your buyers?
- Why can't you deliver a deed at closing? What is a trailing deed?
- Who is my closing contact?
How do I know I can trust you guys?
Our prices are low and we have a full-service team of real estate experts to help you find the perfect investment home with a quick and easy buying process. We do sell real estate using an unorthodox model to pass the biggest savings on to you and offer turnkey real estate investment opportunities, so please read on.
What about negative online feedback I might find about you, including claims that Econohomes is a scam?
We buy in an unorthodox way from our suppliers, and sell in the same way to you to pass along substantial savings. We sell thousands of properties each year. Unfortunately, we will always have a few buyers who fail to take the time to understand our sales process and/or do their homework on their purchases (click here to learn more about how to buy our properties). These situations can lead to online complaints. In evaluating any complaints you come across, please spend time understanding the site where a complaint is posted. Allowing anonymous complaints, as some sites do, encourages abusive complaints that often are untrue and destructive.
Please also contact us directly with any questions and concerns (1-800-779-7150 or firstname.lastname@example.org). We greatly value our customers' feedback and encourage an ongoing dialogue with them through all channels including, Facebook, LinkedIn, and Twitter, along with our monthly customer satisfaction surveys and annual survey of more than 100,000 customers and contacts. With this feedback, we roll out new services and continually strive to improve our processes in order to help our customers better achieve their financial goals by offering quality investment property for sale.
Diligence and Deposits
Can I view the inside of the home?
Absolutely, we encourage it. Call 1-800-779-7150, and a sales agent will provide you with a code to gain easy access to the home.
Do you own the properties on your website or are you a broker?
Econohomes owns all of the properties we sell -- we are not a broker. If you are interested in a property that does not yet show up in our name, we can provide you with proof of purchase.
Why do the tax records show a registered owner of the property that is different than Econohomes?
This is because our supplier has not yet completed the process of transferring the property into our name. Our suppliers typically have 180 days to transfer title into our name. Slow processing of deeds at the city or county office often causes delays. Please call 1-800-779-7150 or ask your sales agent and we can provide you an update of the deed status for any property, as well as proof of purchase.
How can I take a property off the market?
A 10% refundable deposit will take the property off of the market for 7 calendar days. You will have the exclusive right to purchase the property for 7 calendar days. If you decide not to proceed in 7 days, we will refund your deposit. Econohomes accepts wire transfers and bank to bank deposits.
How long do I have for due diligence once I have put down a deposit?
7 calendar days. You will have exclusive right to purchase this property during this time.
Do you accept credit cards for the deposit or down payment?
Not at this time. Econohomes accepts wire transfers and bank to bank deposits.
Does the property information on your site accurately reflect the current condition of the property?
Maybe, but you should always do your own onsite assessment. Our photos and descriptions are generally prepared within 30 days of our purchase. The property information you see on our website is provided by independent contractors (usually a real estate agent or local handyman) not licensed property inspectors.
This information, while useful, cannot fully convey the condition of the property. It is important to perform your own onsite assessment of the property before making an offer. Property conditions can change rapidly, particularly in areas with extreme weather conditions.
What does "no mechanics" mean in the property description?
If the mechanics section of the description states "none", the property did not appear to have basic features such as a water heater or furnace. We strongly encourage all buyers to visit the property to validate the description listed on our website. Our assessors are not licensed property inspectors, but they do provide us with valuable information about the property, its physical condition and the surrounding area.
Is this property condemned or on a demolition list?
Possibly. You should check with the local housing authority before making an offer.
Has the property been winterized?
Most likely not.
Liens and Encumbrances
Do you sell your properties free and clear of liens and encumbrances, including back taxes?
No. We sell our properties “as is” subject to liens and encumbrances including delinquent and current taxes. Econohomes orders title searches on all of our properties and we provide those title searches free of charge to all prospective buyers. However, should you choose to purchase that particular property, you will be charged $155, the actual unmarked up cost, for that title search. Please be advised that title searches are not perfect, and often miss vital information. For that reason, we highly recommend that you seek legal advice from a local attorney and that you perform your own independent title search with the help and advice of your own legal counsel.
Our properties have been through foreclosure, but some liens and encumbrances survive – most notably property taxes and housing code violations. Liens and encumbrances can also arise after foreclosure. Title searches check on delinquent property taxes with known taxing authorities, but do not always review other potential sources of liens or encumbrances (property violations, etc.). The delinquency property tax information may be incomplete or out of date by the time you go to purchase the property; so, again, please retain legal counsel to do your own property tax and title research.
What are the most common types of liens and encumbrances on your properties?
Our properties have gone through a foreclosure extinguishing most liens and encumbrances. There are some exceptions that may survive, including property taxes, housing code violation fines, and certain utilities in a limited number of jurisdictions. Also, new liens and encumbrances could have arisen since the foreclosure (mechanics liens, judgments, etc.)
Taxes and Fees
How do I check for property taxes owed?
Property taxes vary by jurisdiction and can involve a variety of different taxing authorities. We suggest searching online for the County website for that property. It is best to start with the County Tax Collector, but keep in mind that taxes may be handled by the Tax Collector, Treasurer, Tax Commissioner, and sometimes even the Sherriff's Department. Once you contact the correct department they can usually provide you with the information you need by supplying them with the parcel number for the property you are researching. Many jurisdictions have multiple departments that collect taxes on a property (i.e. City, County and School taxes). Some areas have Villages, Boroughs, Townships, and Parishes that you may also have to contact. The County Assessors office should be able to tell you if you need to contact various departments for the information you need. Your legal counsel can also help you in this regard.
If the property is a condo, what are the condo HOA fees?
Similar to property taxes, you, or your legal counsel, will need to research HOA fees on your own. All delinquent HOA dues will be your responsibility. We will do our best to help you find that information, but we are not responsible for any liens or delinquent fees associated with the condominium or unit. We price our properties assuming our buyers will need to bring delinquencies current after purchase.
Deed and Title
Why do your customers buy properties from you without clear title?
Price and speed. Most of our customers are local investors that either understand or can educate themselves on the title and other issues unique to their area. Additionally, Econohomes orders title searches or title commitments on all properties when we buy then, which we can provide at no cost to all prospective buyers. Should a buyer enter into a purchase agreement for the property, the cost of the title search/commitment will be passed to the buyer. We also recommend buyers conduct their own due diligence by purchasing independent title work to have the most recent and accurate information available. The pass through cost of our title searches/commitments may be up to $250.
For the buyer that is willing to do their own homework, we offer unprecedented prices and quick execution with our average sales transaction taking less than 72 hours. This enables buyers to get to work on their new homes faster so they can rent them, occupy them or resell them.
What is your closing process?
We offer two options: (1) cash for deed, or (2) full closing. In a cash for deed closing, you fund the total purchase price including a $1,775 transaction fee and deliver the executed contract to us. Once we have countersigned your contract and returned it to you, you are free to take possession of the property.
For the less experienced Investor, we suggest that you retain legal counsel who can perform a title search to help uncover potential liens and encumbrances.
What is your most common method of closing?
Cash for deed. Most of our customers do not go through full closings with a title company and do not get title insurance. Why? First, they are trying to keep their costs down. Second, title insurance is usually limited to the purchase price. Title insurance will not cover the improvements costs or the resulting increase in the market value of the property. Improvement costs often are a substantial part of the overall after-repair value of a property.
Can I close with a title company?
Yes. We will work with a title company of your choice. If you elect to go through a full title closing, our closing department will help manage the communications, review and oversee the document preparation as well as mail any necessary paperwork to your title company’s office. To go through a full closing, the deed must already be in our name. This may delay the closing process. Our full closing transaction fee is $2,225.
What kind of deed do you provide to your buyers?
A quit claim or special/limited warranty deed. We will provide a quit claim deed unless: (1) we received a special/limited warranty deed from our supplier; or (2) you choose a full closing option and obtain third party title insurance. Our transaction fee for a full closing is $2225
Why can't you deliver a deed at closing? What is a trailing deed?
When we purchase properties, we enter into a purchase contract with our supplier and pay the full purchase price. At that time, we receive equitable title to the properties. Our supplier then is obligated to deliver legal title to us within a reasonable period of time (usually 180 days or less). In other words, the legal title in the form of a deed "trails" the transfer of equitable title to us. We handle our purchase transactions this way because many municipalities are having trouble keeping up with the high volumes of houses in foreclosure working their way through the system.
If we do not have yet a deed for the property you are buying, you have a couple of choices. First, go ahead and close and we will provide you the deed within 180 days. In the very unlikely event that our supplier cannot provide us with the deed within the 180 day time frame, at your request we will refund the full purchase price to you.
Alternatively, you can wait until the deed is available. The downside of this latter approach is that we may sell the property to another investor who is willing to buy the property prior to receiving the deed.
If you want to understand more about the legal distinction between equitable title and legal title, please see Wikipedia's entry on Equitable Title.
Who is my closing contact?
Your main contact is your sales agent, who will walk you through the sales process each step of the way. We also will connect you with someone in our closing department that will handle your closing and delivery of title to you. From your first phone call, to after the sale, our entire team is here to answer all of your questions.
How does your purchase financing work?
We only offer investor-financing with a down payment of the great of 35% or $5,000. We offer 3, 6 or 9 month terms with monthly payments of principal and interest. We also offer 36 or 60 month amortization with automatic annual renewals. Qualifying is relatively simply and the entire loan process is fast. Currently, the only requirement to qualify for our financing is the down payment and an initial loan balance of at least $5,000. We do not check credit or verify income. Please see our financing page.
Do you provide rehab financing?
No, at least not directly. Our purchase financing is intended to allow you to reserve a portion of your funds to improve the property.
Do you offer owner financing for owner-occupiers?
No. At this time, Econohomes only offers investor financing.
Is there a set discount if I buy several properties?
No. Our properties already are deeply discounted usually to the tune of 20-25% below retail. The vast majority of our buyers purchase one house at a time, rehab it, and then either rent it or resell it.
How can I earn a referral fee from Econohomes?
Econohomes values partnering with realtors, brokers or individuals who can help speed the sale of our properties to Investors. Econohomes will pay a referral fee of 3% or $500 (whichever is greater) to any licensed real estate profession for any referral that results in a sale. In order to receive a referral, realtors must hold a valid and active real estate license, and they must comply with the State’s laws for licensing and referral fees for the State in which the property is located.
Can I advertise Econohomes properties for sale?
The posting of addresses, photos and/or prices for our property inventory on any website, social media, document or other advertising options without the express written permission of Econohomes Marketing Department is not permitted. We manage our property information rigorously to develop a trustworthy and transparent relationship with our customers, and ensure that they have access to the most accurate information to make an informed buying decision.