Bank Owned Homes- A Good Deal or Not?

Are bank owned homes really a great deal? More and more clients are asking me about bank owned homes.  Are these homes really a great deal?  The not so simple answer is, maybe.

First lets determine how a bank comes to own the property in the first place.  Once a home owner falls behind on their mortgage, the bank notifies the home owner requesting payment.  If the homeowner is unable to bring the loan current, a short sale might be a possibility for the homeowner.  Short sales will be discussed in an upcoming blog.  If the home owner is unable to pay the loan, the bank will put the home up for auction to repay the debt.  If the home does not sell at auction, the bank will take possession of the home and bring in an asset manager to sell the property to sell the property.

You can get a good deal on a bank owned home, but they also come with several large drawbacks.  Make sure to weigh the benefits of a good price against the potential issues that could come with buying a bank owned home.

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First Time Home Buyers

I get asked by first time home buyers all the time, “How do I get started?”   Buying your first home can be confusing and seem overly complicated.  With a little help from qualified professionals the process is a lot easier.  A qualified Realtor can be a big help in this sometimes long and confusing process.

I usually ask buyers to start by talking to a couple of different loan officers to see what you qualify for, and which bank will give you the best deal.  Loan programs and underwriting standards vary from bank to bank, so don’t be afraid to see who is the best fit for you.  If you do not have a loan officer, your agent should have a list of quality loan officers they have worked with in the past.

Once you have an idea of your budget, you need to sit down and prioritize what is most home features are most important to you.  Do you want something to fix up or move in ready?

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