Foreclosure Bargains

Banks are cutting prices to empty out growing homes inventories and entice homebuyers. Banks are competing with sellers facing foreclosure and desperate home builders. Because of this, bargains are readily available especially with home buyers with cash on hand, good credit and are willing to take a chance on a bad market. Those buying homes for the first time and investors who couldn’t afford to purchase a house during the past housing boom are now quickly buying up homes that have been foreclosed on. This is causing an increase in sales activity in a few communities. Properties that are owned by banks are vacant. If you have a strong financial background you are in a great position.

Potential home buyers can log on to internet and find foreclosure websites. The potential home buyer can take virtual tours, look at photographs of homes and use maps to locate houses near them that are in various stages of foreclosure. Bank of America, Countrywide, and JP Morgan Chase have online listings of many foreclosed homes that are being sold across the country and they have information on listing agents. Some listing agents post video tours of neighborhoods with many foreclosed homes. These video tours also show the insides of properties that are owned by the bank.

Purchasing a home owned by the bank requires the potential home buyer to do research and go directly to the property. Some real estate agents specialize in listing homes owned by banks. In markets that are being hit the hardest with the amount of foreclosures, such as Michigan, Nevada and Maryland, foreclosure bus tours have been started. These foreclosure bus tours take potential home buyers to different properties. It is very important to walk around and look inside a property owned by the bank because they are usually sold “as is” and the bank does not have to follow the typical disclosure requirements. A potential home buyer can protect themselves by hiring someone to check the foundation, check the roof, and check the pipes. A foreclosure will most likely not be in the best condition. Banks who take over the home will not spend money on repairs.

For example, a ranch home with five bedrooms and four baths in Granada Hills California that had two kitchens was being sold at a discount. The asking price for this three thousand square foot house on a pretty street lined with trees was five hundred and seventy nine thousand dollars. This was forty three percent under market value. However, if one walked into the home, one could see that it was a fixer upper. The kitchens and bathrooms needed updating, the floor was buckling and the paint was peeling. The bank that owned the home spent two thousand dollars to remove the trash that was left by the former owner before he was evicted. The home was in poor shape and needed sixty five thousand dollars in repairs. Even so, getting a home like this is a good deal when you compare it to other foreclosures. Purchasing a home that large in a good neighborhood for five hundred thousand dollars is nearly impossible.

There are some homes that are in good shape that might have a surprise in store for the potential home buyer. An agent in northern Virginia went to a home owned by a bank and found a refrigerator filled with rotting food and black milk. The house had been on the market for two hundred and forty days.

Even so, most potential home buyers are willing to deal with unexpected surprises to find a bargain on a home.

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