Embedded Files
Bank Owned Property - Guide To Buying Discounted Real Estate
Bank Owned Property - Guide To Buying Discounted Real Estate
A bank owned property can be a great way of buying real estate at a discounted price. Bank foreclosures include residential and commercial properties as well vacant land. Bank-owned properties could be your best option, whether you are looking for a vacation home, investment property or a piece of real estate.
Buyers must submit offers to the bank's loss mitigation department or designated realtors in order to buy bank-owned property. Banks that have multiple foreclosures often employ local agents to list and show properties and make offers. Buyers need to be aware that banks will rarely lower the asking price unless there are extensive repairs made during inspections.
The foreclosure process can often cause banks financial hardship. On average, a foreclosure property loses $60,000. Banks have one primary goal: to recover the majority of their losses from selling repossessed properties. Buyers should offer the asking price, or slightly less.
Most real estate foreclosures need repairs. This is especially true for residential properties. Unfortunately, homeowners who are foreclosed often cause property damage to retaliate against lenders. Appliances can be removed, flooring and walls damaged or destroyed, or windows and plumbing commercial Foreclosures fixtures broken.
Prices for real estate are determined based on the current market value. They can be adjusted to reflect repairs that may have been made. Buyers should do their research and obtain property appraisals. You can negotiate the purchase price by using repairs that are discovered during a home inspection and not documented in original documents.
Most bank-owned property is priced at least 10 percent below its market value. There are other options that buyers have to get additional discounts. First, you can buy a home through Fannie Mae’s Home Path mortgage program.
The government-sponsored mortgage financing program provides a wide variety of foreclosure properties at a discounted price. Many of these homes are in areas with a high foreclosure rate. They may be eligible for Neighborhood Stabilization Program grants through HUD.
Fannie Mae created Home Path in order to eliminate their national inventory of bank foreclosures and offer special financing options. Home Path is a great option for buyers with poor credit or those who can't afford the down payment required by conventional home mortgage loans.
Home Path requires a minimum of 3-percent downpayment and allows borrowers the ability to get down payment assistance from outside sources. This is not permitted when conventional lenders finance. HomePath.com provides details about the program and listings of foreclosure properties.
You can also buy bank-owned property at discounted rates by looking for real estate investors that buy bank portfolios. Investors can purchase foreclosed properties at wholesale prices, which allows them to make a profit while still selling the property below market value.
Buyers should also consider bank-owned property that has been listed for at least 60 days. Sometimes banks will negotiate prices when the market is stagnant or no one has submitted an offer.
Page updated
Google Sites
Report abuse