FAQ

Question: What to consider before buying a foreclosed property?

Answer: Below are the essential information that you need to consider before buying a foreclosed property:

1. Inspect the place - You should check the actual place and location.

2. The inspection officer or appraiser have already done the actual inspection but you should not rely on that, it was inspected several months ago so the current condition of the property might already changed.

3. Be careful. There are some cases, that during the inspection of the officer or appraiser there is no tenant occupying the property but after a week or month, there is an illegal occupant exist in the property. This is because, the illegal occupant would want to take advantage and ask for move-out charge from the successful bidder of that property. So, you should carefully check the history of inspection.

4. There are two important ways in inspecting the foreclosed property:

4.1 Go to the place and check if there is an occupant or existing tenant.

4.2 Go to goverment office and check the article for public display of foreclosed properties.

Note: You have to check the present condition of the property.

5. Look for potential foreclosed property.

6. See if what is your first impression of the property. You may feel the worth of that property.

7. Ambience of the property should also be considered.

8. Observe and investigate the existing occupant. Are they working in weekdays or weekends? Is there a sick person in the occupants? (Occupant who are sick or elder person may affect the compulsory move-out process)

9. To know more about the property, you should consult with the neighborhood.

10. Is the occupant a debtor or legal owner? You should check through telephone directory.

11. Knowing all about the property condition and it's existing occupants will help in negotiation after you get a successful bid. So that you can easily negotiate the smooth move-out of the existing occupants.

Note: Above mentioned process are necessary for every bidder and that is why Mizushima Co. is here to help you in every process.

>>

Question: Where can I buy a foreclosed property?
Answer: The regional jurisdiction court that takes care with investigation for buying of the foreclosed properties. For instance, if the foreclosed property is under Tokyo Ward No. 23, The Tokyo District Court Civil Affairs will take care of all the buying process of that property.

>>
Question: How can I get information about foreclosed properties?

Answer: Different regional courts provide the information about foreclosed properties through their website. Please visit http://bit.sikkou.jp/ (This is Tokyo region home page. Contents are all written in Japanese, but if you wish to help you with the translation, please just email us and it will be our pleasure to assist you); Also, there are some companies that provide information about foreclosed properties. However, the complete details are not usually posted.

>>

Question: What if the property was occupied by other individual after successful bid? How sure that I can move-in without any problem?

Answer: The process of negotiating with the existing occupant needs to undergo with legal proceedings. Moreover, it can be easily done by applying due process with court office.

If you found some potential properties from other website's listing, just let us know how we can help and we will assist you in getting more specific and detailed information about that property.

>>

Question: What does "Case Number" mean?

Answer: It is the sequence/ event number issued by the court official in any certain judicial process. Of course, this is not a case number that is referring to any murder case. This is referring to a legal procedure from where you can easily buy foreclosed properties with very practical and low price. Moreover, it is the legal process of dealing with the person who failed to payback the borrowed money in order to secure the property mortgage.

This procedure has been declared in Article No. 1 in 2009. Thus, all the court proceedings or issues concerning with foreclosed property must undergo with this procedure.

>>

Question: What are the necessary fees and charges?

Answer: These are the necessary fees:

1. Expense for the smooth move-out of the existing tenants or owner.

1.1 When a bidder directly negotiate the voluntary move-out of the existing tenants or owner, the expense amount is aproximately 3,000 USD to 10,000 USD.

1.2 When a bidder apply for compulsory move-out of the existing tenants or owner in the court office, the expense amount is approximately 10,000 USD to 20,000 USD.

2. The fee amount of compulsory move-out may vary depending on the location, size of the unit, material used, apartment/mansion with or without elevator.

3. Default management fee and maintenance/ renovation fee. It is declared in Japan law that successful bidder or buyer needs to pay the debt of former owner concerning with the foreclosed property.

4. Realtor fee. This fee is for the renewal of lease contract.

5. Repair of the unit or property. It depends on the preference of the successful bidder or buyer.

In case of apartment to be used for investment purposes:

1. Key money or deposit

In property details "3. other rights to which a buyer should succeed from the former owner" section, the buyer should also succeed at public sale of former owner same as to a lessor's position. If the lessor paid key money to the former owner, the buyer should repay that key money to the lessor.

2. Processing fee for the renewal of lease contract

Buyer should pay the realtor or broker for the renewal processing of the lease contract.

3. Renovation fee

Buyer needs to have enough funds for the renovation of the apartment or property.

Note: This rule will not be applied to lease contracts that was made after April 1, 2004

4. Miscellaneous:
4.1 Registration tax
4.2 Postal stamp
4.3 Loan processing fee, if any.
4.4 Fee for changing the unit key. This will cost 100 USD.
4.5 Unit renovation or remodelling fee, if any.
4.6 Acquisition tax
4.7 Agent assistance fee. Usually we only get 3% upto 6% of the property amount. We use the very low and standard assistance fee.
- Other fees might exist on case to case basis.

Question: If I made successful bid amount in the bidding, do I have the right to remove or return the belongings of the existing occupants?

Answer: Basically, We cannot dispose the belongings of the existing occupant without their permission because what we bid is just the real-estate property. They still owned their belongings. So, we need to ask them to remove their belongings by themselves. But, if the existing occupant refuse to remove their belongings due to some reasons, we need to pay the amount of their belongings or purchase it from them. This amount will be charged to the successful bidder.

The reason why we need to purchase or pay the amount of their belongings is to avoid from doing compulsory execution through court Office. Removal of belongings through compulsory execution will take high amount of money, in such cases you need to pay about 1,000,000 yen. But, if we successfully remove their belongings by paying them directly, you may spend about 200,000 yen or less.