Bank foreclosures seem to be a hot topic with today's buyers so I thought I would write some more information about buying one.
Here are some questions that buyers frequently ask before purchasing a foreclosed home:
How long will it take the bank to respond to my offer? Every bank is different, some may respond in 2 days, and some may take as long as month to respond. Manytimes the employee at the bank who lists the home with the Realtor is not the person who can make the decision about an offer that is received. The listing agent must go through several chains of command in order to locate the right person.
How old is the roof / furnace / water heater / plumbing etc. In most cases the bank is located in another state and has not seen the home in person. They will not have information regarding the roof, furnace, plumbing etc. This is where the importance of having home inspection comes into play. A home inspector can usually tell you how old the major systems in the home are and if they are in proper working order.
Will the bank make any repairs to the property prior to closing? That all depends on how willing the bank is to negotiate. Some may be willing to make a few repairs to the property, but some banks may not. Before writing your offer take into account the repairs that may be needed and write your offer accordingly. Usually the listing price has already been discounted due to repairs and updates the property will require.
How long has the home been vacant? Usually we don't know. The foreclosure process can sometimes take years to be completed. The homeowners may have left a year or two ago, or a month ago. During the process their homes have not been maintained properly. Once the bank gets possession of the home they will go in and winterize the property to protect the major systems in the home.
How do you locate bank foreclosed homes during your home search? Most of the bank foreclosures can be identified by the wording in the listing description. It will say key words such as: minimum earnest money deposit required, selling as is, seller makes no warranties, bank owned etc. Also, you can pull up the auditor website and type in the address to view who owns the property.
Do you have any other questions about buying a bank foreclosed home or would you like to receive foreclosed listings by email? Please contact me.