Bank owned properties are the perfect choice for real estate investors. These bank owned properties are homes that the bank repossessed and didn’t sell at auction. Buying bank foreclosures is favored among many experienced real estate investors, because the price is right, and transfer is quick.
Bank owned properties can consist of residential homes, commercial real estate, or even vacant land; when the banks initially foreclose on the property, it is listed in a public auction. So why is it better to buy the properties that didn’t sell at auction? That’s easy; homes bought through auction may still have tax liens and creditor judgments, and sometimes even the owners still occupying the house. If you buy a house at auction, you’re responsible for taking care of it all.
If you buy bank foreclosures that didn’t sell at auction, you get a clear title. You’ll avoid the messy tax problems, second mortgages to pay off and aggravating evictions. Any price you pay for a property at auction only covers the single mortgage; if there are any other debts tied to the property, the purchaser is responsible for paying them.
If you need another reason to avoid purchasing foreclosures at auction, consider the fact that many states have a redemption period in which owners have the option to buy their property back from the auction winner.
On the down side, bank foreclosures usually cost more than foreclosures sold at public auction. On the flip side, because foreclosures bought through public auction can be tied up by many factors, bank owned properties are much more attractive to many investors. You have a clear title, and are able to take immediate possession of the property.
Now that you know why you should be looking at bank foreclosures as opposed to fresh foreclosures on the auction block, let’s discuss how to get the best deal. The price on new foreclosure listings are usually at a set price. Look for properties that have been listed for at least a month; the longer a foreclosure has been on the market, the more open the bank will be to negotiation.
Locating good deals on bank foreclosures takes time, but it’s well worth it. Remember to carefully evaluate the investment before you spend any money. At Realnet, we have investment property for sale and can help you find the best deals available. View our selection of Florida foreclosures and let us help you find the perfect property!