Time, Patience, Perseverance-Beware, this is a long post.

Buyers need to understand that it can be a frustrating process and may not be the right fit for everyone.

Yes, there are a lot of homes on the market at any given time, but there are also a lot of buyers and investors out there right now due to the prices coming down so much over the last 6 months and they are all looking at and competing for these deals.

For example: You may see 4 bank owned homes that say on the websites they are for sale, (they have the "ER" usually), but what you don't know is:

A: The bank may have 5-10 offers already on each of those homes and is countering on each offer until they have reached the price they want, and each one of those offers may not know the bank is also countering on all the others.

B: The bank is in process of signing the best offer they picked and they have told the listing agents that they are not to accept any more offers.

C: The listing agent is so swamped they haven't had a chance to go and change that "ER" to a "P" or "C" indicating they have a signed accepted offer on the property.

D: Some of the homes are already slated for an upcoming auction and the bank is not taking any offers until the auction.

E: The property has been "pulled" for an investor package deal of several homes and the one you want is in that package.

So as your agent representing you as the buyer, you can see I have a lot of things to do and research, calls, email, etc, before I ever show you that first house.

I explain to clients up front that the reality is normally the bank wants top dollar and a quick close.

Which usually means:

#1: A Cash offer will most likely be 1st choice followed by

#2: Conventional and then

#3: FHA.

Most of the homes that are in fairly decent condition and are priced under $300,000 already have multiple offer after day 2, so you need to be prepared to put in your "BEST" offer the 1^st time up front. Most are not even going to look at an offer that is contingent on selling your other home first.

Depending on the home and the area, even offering above list price, does not guarantee that your offer will be the winning one.

Many homes are being priced really low to entice the multiple offers. It is not uncommon to hear about 10 or more offers on some of these homes.

Time frame for a bank to respond to an offer can be a few days (4-7 Business days) up to you may never get a response from them on the offer. Most buyers at first say "ok" I'll wait, but by day 5 they can't take the wait of not knowing any longer, clients I am currently working with can attest to this. I know this is a long time to wait, but it is a fact of how things are going right now.

Banks also have many "hoops" they want you "the Buyer" to jump thru, long before they ever even sign any your offer. They usually will require the buyer sign documents stating "they" can and will continue to take offers until they decide to pick the best one and sign it. Many say the bank has the right to cancel the contract right up until the sale date, but you can‘t. Some make you pay for the transfer tax and all home owners association fees and documents. So, decide up front how many days you are willing to wait on a response from the bank, let your agent know, put it in the offer and be ready to move on to the next house as soon as the time frame is up. You should prepare yourself that you may have to put offers on 3-4 different homes before you get 1.

Buyers need to understand that about 75% of the homes need some form of repair, some may only need a bit of paint to a complete rehab, and you are buying the home "As Is" and the bank is not going to do any repairs. The pictures on the internet may look good until you get to out there to see it yourself. Most need 1 or more new appliances. Most have nics on the walls, few holes here and there and need to be some paint. Most have been sitting vacant for 6 months or more so the landscape will most likely be dead or close to it.

You need to decide before you go out looking, how much time/money/work you want to put into the home.

Here are just a few ?'s to ask yourself:

Do I have time on my current lease to stay in it until I can fix the home before I move in?

Do I want to buy a home that I have to replace all the carpet?

How much painting do I want to have to do, or pay to have it done?

How much and how many appliances can I afford to replace?

Will the type of loan I'm getting allow me to buy a repo?

What closing cost expenses and how much am I willing to pay if the bank won't pay them.

These are just some of the things a buyer needs to be aware of up front and I don't want to scare any one off from trying to buy a bank owned home, but the more informed you are the better off you will be.