Bank owned homes are still everywhere in our real estate market, but the risk doesn’t always come with a reward. It could be a great choice for you, but think about these few things before jumping into one.
Banks lend money, they don’t fix homes. This is something to think about when looking into a foreclosure. A bank will not make any repairs to a property, no matter how much damage there might be. In this case, you want to make sure you get the home inspected before closing on the home. The inspection still won’t get you any help from the bank, but you may be able to use the results in the negotiating process to get a cheaper price.
Homes owned by a bank can take a long time to close. This is not always the case but majority of the time it takes way longer than a home in traditional sale. This is usually due to the fact that asset managers at the bank have backlogs of work, taking them longer to get to closing your home sale. Most of the time, the wait depends on the local market and size of bank.
Not Always a Deal
You may typically assume that bank owned properties are listed below market value, but this is not always the case. In many cases, properties go on the market for more than they’re worth because the bank’s goal is to get as much as their money back as possible. Always get a comparative market analysis from your realtor in order to see what similar properties in the area are going for. Take in account what the inspector said needed to be done to the home, because this is more money you will be spending.
Buying a foreclosed home can possibly be a great deal for you, if you’re willing to take some risk. Always remember to get the home inspected by a licensed inspector and to find out how much other homes in the area are going for. Always go over it with your realtor to get the best advice on all possibilities, that way you don’t end up paying more than you should.