June 18, 2024

Obligate Law

Professional Law Makers

Bank Owned Homes and How to Get Your Offer Accepted

2 min read
Bank Owned Homes and How to Get Your Offer Accepted

Market conditions are currently in favor of buyers but it does not mean buyers are having an easy time getting their offers accepted. In fact, the competition has become quite tough for buyers of bank owned homes because of the fact that these foreclosed properties are under priced.

Multiple offers are common especially for prime repo homes. For this reason, you must make sure your offer stands out above the rest. Consider the following tips.

1. Obtain Property History – this would help you determine how much the purchase price was and compare it the selling price. You can make an offer that is midway between the foreclosure sale price and the mortgage balance. If the home is underpriced, the bank usually accepts such an offer.
2. Compare Market Values – look at similar bank owned homes which have been sold in the past three months and find out how much the winning bid was. Usually, buyers make an offer based on the list price and not the current value of the property in the market. You might also want to check out pending sales as well as active listings to give you an idea of how much you should offer for the property.
3. Determine Number of Buyers – you should definitely find out the number of offers the seller has already received. If there are none, you can offer less and the seller will most likely accept it. If there are several offers, you should step up your game by offering to pay in cash. For those of you who will obtain financing, a pre approved letter and a higher offer just might do the trick.
4. Do Not Ask Bank to Pay for Repairs – most sellers will not offer to pay for repairs or even inspection so do not waste your time asking. Instead, you can bring up the subject after the home inspection report has been completed, the problems were identified and the bank has accepted your offer. You will need to renegotiate these issues.
5. Request for Shorter Inspection Period – it is important you come across as a serious buyer so when it comes to the inspections, you can request it to be done in 10 days if the other interested buyers are asking for 15 days.
6. Split Fees – sellers will most likely choose your bid if you offer to shoulder half of the transfer or escrow fees.
7. Check Appraisal – your offer should also be in sync with the appraisal value, which should be close to the selling price. Low appraisals sometimes arise due to the multiple offers but the banks will be the one dealing with such situation.

By following these tips, you are in a much better position to own one of these bank owned homes. Just make sure you set aside money for repairs since these properties will require much rehabilitation after going through a lot in the past months. Go over your finances one more time to be sure that you can really afford the bank foreclosure.

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