It's commonly assumed that bank owned homes are a real steal and one should run out blindly and buy it, but that’s not always the case and mostly is not. Banks are much more motivated than most sellers for sure as they have thousands of home “in stock” and want to get them off their books as soon as possible, but they also know they don’t need to make their losses any worse than they already are. When considering buying a bank owned home, you need to be as prudent as you would be in any big purchase and check your comparables to make sure you are getting at least a good buy, which you usually are.
Chris Farkas
EXIT Realty Associates
www.RealBellingham.com
www.SoundShortSale.com
www.CHristineFarkas.com
You are right. Another thing that buyers must consider is the property condition and how much that they must put into the foreclosure to get it up to par with the non-foreclosure comparable homes.
I think that the biggest problem the banks face is valuing the properties. Often it seems that the person 'negotiating' at the bank is in some remote location where values are out of whack with where the house is...
That's where a good BPO and REO agent comes in handy that knows the local market...
Sometimes you can negotiate a lower rate if you get a mortgage and buy the REO from the same bank.
Good luck to you in 2009
Karina
Chris, I agree! When making any purchase, it pays to do your due diligence.
Chris
Hi good post,alot also depands on your local market.Here in the Milwaukee market even if you do your homework the banks are getting in the 90% range for most of our town.That makes it hard to find a good deal you need to jump on it and not think to much.Just my two cents.
Bob Oettinger
Bob,
You are absolutely correct. Bank owned deals are heavily geographically dependant. In my are of upstate Washington our values are still strong and banks are not negotiating too heavily. If it is a good deal we have bidding wars.
CHris Farkas