Bank Sale

Bank sales are a fantastic way to find bargain property.  When a bank or lender forecloses on the property of an owner that has failed to comply with his or her mortgage agreement or deed of trust, the bank or lender frequently puts the house up for sale.  There are advantages and disadvantages of buying property through bank sale.  However, if you play your cards right you can find fantastic deals through this method and then resell at a fantastic rate of return.

When banks or lenders foreclose on property, they tend to sell these homes at prices that are ridiculously below market costs just to get rid of them.  The reason for this is simply that banks and lenders don’t have the motivation to try to sell these homes at a profit.  They are in the lending business, not the real estate business and don’t have the time or concern with making money from their repossessed property.  They are happy receiving the unpaid debt with minimal or no profit.  As a result, you can find amazing deals through such sales.

The difference between buying through a bank sale and buying through a real estate agent or homeowner directly is that bank sale homes are sold “as is”.  This means that no renovations have been made and the home has not been prepped for sale.  In addition, inspections are not always done to check for leaks, infestations or other problems with the property so it is important to do your research beforehand to make sure that you aren’t stuck with an unanticipated amount of renovations.  Important things to check for are the quality of the plumbing, heating and electrical systems and the state of the roof.

Houses up for bank sale usually go quickly so you don’t have a lot of time to think or act.  However, if you do your research and act quickly a bank sale home can be a wonderful investment.