Tips to Buying a Bank Owned Property
People who plan to buy a bank owned property will probably think that they are getting a good deal, particularly with the low prices of distressed and foreclosed properties nowadays. But there are other things that buyers can do to make the deal a better one.
Getting a Better Price
Even if buyers think they are getting a great price, there are still steps that they could take to make the purchase price even lower. One way of getting the best rate is to look for houses that have already been available on the market for some time. Banks are usually willing to bargain when a property has already spent a few months on the market and is yet to be sold.
When negotiating for the actual purchase price, the offer should be 15-25% below what the bank’s asking price is. Of course, there is no assurance that a bank would agree to the offer, but if they are eager to unload the property, a buyer will have a better chance of winning the bidding war.
Buying a Property That Requires Renovation
Sometimes, people are turned off by a bank owned property that looks a bit rundown. However, the initial impression should not be the only basis for judging the condition of the dwelling. Some rundown-looking houses may be even better deals than flashy looking homes.
For one, homes that require repairs are offered at very low prices. People looking for a house to purchase might be wary of dwellings that require repairs, but if the adjustments needed are just minor and will not raise the price too much, then it would still be a good deal.
The trick is to have a professional property inspector look at the foundations of the house. If the foundation is solid and does not require fixing, then the cost of repairs will not be high. Add the costs of repairs with the purchase price and compare the total with the selling prices of similar properties in the neighborhood to get an idea whether the deal is a good one.
A bank owned property can be a good deal but buyers can make it even better if they take advantage of the opportunities open to them to get a lower price and a house in good condition. Hiring a licensed property inspector and a real property lawyer will also help.
