When homes in foreclosure don’t sell , they are repossessed by the mortgage lender or bank. These homes are known as real estate owned foreclosures, or REO properties. Purchasing a bank-owned foreclosure has a variety of benefits over other foreclosure purchase choices, for example preforeclosure sales or buying at auction. As mentioned at HUD Clips,”Unlike many vendors, banks are highly motivated to market their REO properties that works to your benefit.” Additionally, although some properties might not be in mint condition, banks may often make small repairs to the homes they repossess so as to increase the attractiveness of their house.
Look for bank owned properties in your preferred area. You are able to go to Bank Owned Properties online and enter your zip code, state or city to acquire updated foreclosure listings. The site offers information at a minimal charge for seven days, after which a monthly or annual fee will be applied if you do not cancel your account. You might also obtain local listings by visiting local bank or banks sites, which will generally offer foreclosure information at no cost.
Enlist the support of a real estate agent to assist you through the purchase process, which can be much more complex than a conventional real estate transaction. Start looking for an agent who has completed the National Association of Realtors” Short Sale and Foreclosure Certification Program, and who have past experience with bank-owned foreclosures.
Schedule a home inspection with a general contractor. As mentioned at Realty Trac, any savings you might receive by buying a bank-owned foreclosure may be jeopardized by extensive repair costs. Find a repair cost estimate in the contractor and budget it in your overall purchase price.
Search public records for any outstanding liens or taxes on the house. If you purchase a bank-owned foreclosure with excellent fees, you’ll be asked to pay them.
Research the home’s neighborhood thoroughly to determine whether or not the purchase price is actually a bargain. A realtor can help you obtain recent sales info, which will allow you to compare the asking price and overall home specs of this foreclosure home to other homes in the area.
Get financing from your mortgage lender. As noted at Realty Trac, you may just be asked to make a 10 percent down payment if you’re buying the property for lease purposes. For best results, get preapproved before you make an offer on the home.