So You've Been Thinking of Buying a Bank Owned Real Estate
Bank owned real estate otherwise known as real estate owned is a property that reverts
to the bank or to other lending institutions after and failing to sell at a foreclosure auction. As the bank now owns the property the mortgage loan ceases to exist. Banks will take care of the eviction process and may sometimes do repairs on the property. They will also deal with the Internal Revenue Service for the removal of tax liens and settle outstanding dues at the home owner's association. Buyers of these types of properties will get a title insurance and can inspect the property.
On Finding Real Bargains
Not all bank owned real estate are good bargains. Buyers must ensure that the price of the home is similar to the prices of the same type of homes in the neighborhood. One should also take into account the cost of repairs and renovation.
When you make an offer for a real estate owned property, the bank or lending institution may give you a counter-offer. This is more to satisfy stakeholders that the bank attempted to obtain a good price for the home. Buyers may still make an offer based on the bank's counter offer.
All bank owned real estate are sold as is. A minimum pest certification will be offered which you may turn down. The inspection cost will be shouldered by the buyer as well as all the needed repairs. Buyers may include a clause that will nullify the sale if an inspection uncovers damages unforeseen damages the bank refuses to correct. Always allow the bank the opportunity to undertake repairs or re-negotiate the price after you have concluded your inspection.
While there are hundreds of good bargains on real estate owned properties, buyers can only get to it if they have the diligence to undertake proper research and careful planning.
So You've Been Thinking of Buying a Bank Owned Real Estate