Buying Bank Owned real estate can be a great way to get a good deal on a home/property or it could be a nightmarish experience. In order to make sure it is a good deal you need to work with an agent who specializes in bank owned properties. There are many advantages and downsides of buying a bank owned properties, part two of this series will be Disadvantages of buying bank owned real estate.
*Most often a lot more Due Diligence is involved. These days there are so many bank owned properties that we get a good mix of the good, the bad, and the ugly. There are some gems to be found underneath the rubble! You must have an agent that will educate you on the due diligence process!
*Counter Offers will be verbalized from the bank in most cases.
*Negotiations can go on for a while. The banks are swamped right now and sometimes they only answer offers on certain days or when they get around to it.
*Properties can be filthy, stinky, and vandalized.
*Sold "as is," banks will not fix problems associated with the property.
*Properties are usually winterized and it's up to the buyer to get the water turned back on to inspect the septic and water systems and quality.
*The property may have several offers on the table, make sure your agent educates you on how to make your offer strong.
*Your financing needs to be in place before you place an offer. A pre-approval letter needs to accompany your offer.
*Earnest money will need to exceed the norm...usually 3% rather than 1%.
*Your friends will be jealous when you get a great deal.