Got to know about bank-owned or foreclosure homes by your real estate agent or a neighbor in Burbank recently? You are all excited about the prospect of a cheap deal? Well, you’ve come to the right place to learn all about it.
First off, what are they? Bank-owned homes or real estate owned properties (REOs) are homes which are owned by banks whose debtors can’t afford to pay back the loan. They’re then put up for sale to recover the cost of the property. They are also known as foreclosed homes. Now that you know what they are, let’s go find them.
Where to Find Bank Owned Homes Near You
Bank owned homes are usually listed by your local banks, as well as lending institutions or mortgage providers? These organizations provide listing of their bank-owned homes several times during the year to real estate agents to help sell them off. Also, instead of visiting the bank you can log on to their website to find the listing.
You can also contact a professional real estate agency like Los Angeles Property Management Group which offers purchases and sales of properties like these as well. We can locate REOs for you that fit your budget.
Alternatively, you can go online to real estate websites like Zillow or Craigslist to find listing of REOs with their details and how to bid for them.
Before You Buy
Alright, you’ve found your property and you’re ready to splurge. Before you do, a word of advice. Umm, make that several words.
When something is unbelievable, it is unrealistic. Bank-owned homes have a host of issues attached to them. So when you choose a property consider liens (although most banks clear them before they put up for sale) to the title, condition of the property, damages, and other issues which otherwise a homeowner would have warned you about. Banks are pretty mum in this regard. It would be wise to check with the public records office, neighbors, and local authority for them.
While REOs are put up for sale as and when they’re ready, sometimes banks require pre-approved letter before they even look at your application for sanctioning loans to buy the REO. Better go prepared then lose out on the bird.
How to Buy
OK, now that you’re ready let’s see how you can buy a bank owned home.
Once you find a bank owned home for sale near you, the first thing you need to do is review the paperwork involved to bid on the property, or get a property management company to do it for you. The key here is to make sure that you’ve negotiated on the right triggers to motivate the bank to give it to you. Things to consider are low or high total price, interest rate, and closing costs.
Then you need to wait…a long while. Expect anything from two or more weeks before you get a reply.
Sometimes you also need to counter offer to the bank for the application sent to build your case for purchasing it. Most of the time, the conditions are pretty complex with legal rules and terms following California laws. This is why it’s better to have a professional deal with your transaction for you, from start to finish.
Once you get a positive reply, then prepare to pay up. If you’re a first time homeowner with hard cash then, there is no delay there. However, if you’re using a mortgage company then you’ll have to coordinate with them to release the amount for purchasing the bank owned property. You may have to pay a bank charge for underwriting as well as bank service fees.
Once when everything’s in order, and the bank approves, then congratulations! You’ve purchased your first home!
Buying a bank-owned home is not as easy as it sound, isn’t it? Whether it is worth your effort or not depends on the type of home you’ve selected, price and use. The reason why they’re quite popular is because first time homeowners can afford them, and investors can definitely get good bargains when they opt for bank-owned homes.