Bank repossessed property is a bitter-sweet thing. On the one side it’s sad that a family has to lose their home because they couldn’t afford the house, but on the other side there’s a bargain waiting for a future homeowner. When an owner falls back on payments and fails to keep them up, the bank is forced to repossess the owner’s home in order to cover their losses and prevent further ones. This bank repossessed property is then sold at an auction.
Bank repossessed properties sold at these auctions normally go for 30% to 50% less than the market price. So a first-time buyer can get a few steps higher with his or her budget than would be the case with a new home. At these auctions the bank normally sets a reserve price and the highest bid above that wins the house. Before you start bidding right and left though, you should make sure you know everything about the bank repossessed property you are bidding on. Have a professional property surveyor make a complete survey of the bank repossessed property so that he can tell you what damages you might have to repair, what services you might have to pay to reconnect. Also estimate how much, if any, money you want to spend on renovations. Further costs you need to add to your budget are that of the lawyer to register the property in your name and your monthly mortgage repayments.
You should also do some very thorough research on the location of the bank repossessed property. Make sure of the crime rate, safety and noise levels. When you are happy with the bank repossessed property you can start the process of buying your dream house!