There are many pros to buying a bank-owned property. These types of homes sell at a lower price than other homes. Bank-owned properties often have low-interest rates and low down payments. There is no need to negotiate with a homeowner, which is a big deal because you’re negotiating the price of a home, and emotions often get in the way for a homeowner trying to make the right decision to sell their home. You are allowed to view the home when it fits your schedule; you don’t have to wait for a homeowner to fit you in. These benefits are great if you are looking to buy a home, and you want to save as much as you can throughout the purchasing process.
As with the pros, come the cons of bank-owned properties. With bank-owned properties, there are many different buyers who are as qualified as you who want to purchase the same home. You will not be able to have a contingency clause with a bank, so that means you cannot sell a home first before you purchase a bank-owned property; banks see this as too high of a risk. So unless you want to have more than one home in your name, you are not going to be able to buy a bank-owned property without selling your home if you only want to own one home at a time.
The bank may also take some time to get back to you because of the many offers they receive from other buyers. There is also the negative of purchasing the property in the condition as is. This means that it is up to you, the homebuyer, to make any updates to it if you do not like certain features of the home. The negatives that come with a bank-owned properties require lots to think about and consider.
How you should go about buying a bank-owned property is slightly different than how you would buy a regular home. First, talk to a real estate agent who has experience with bank-owned properties. They will help you understand the proper steps you should take. They will most likely tell you to sell your home first since banks will not accept a contingency on you selling your home before you buy the bank-owned property.
After you find the home you want, you will then need to get prequalified. Once you are prequalified, make an offer on the home. The bank will then reject or accept your offer. If you are accepted, and you’ve completed the process of buying the home, congratulations on buying a bank-owned property!
So is a bank-owned property right for you? It all depends on your particular situation. Do you already own a home? If so, you’re going to have to sell it before you purchase a bank-owned property if you do not intend to have more than one home at a time. If you do not own a home yet, this is a great time for you to purchase a bank-owned property since you have no other home to sell before you make your purchase. Be sure to learn more about bank-owned properties and hopefully they are the right type of home for you!