3 Tips For Buying a Bank Foreclosure in Placer County

 For those of you unfamiliar with the term REO, it is an acronym for Real Estate Owned.  These properties may also be referred to as bank owned or foreclosures.  When a borrower defaults on their mortgage payments, the lender(s) will start the foreclosure process, which starts with the notice of default (NOD).  Once the foreclosure process is complete the bank now owns the home and may sell the property to help recoup their losses.

  REO's can vary in condition.  Some of them are gutted, missing appliances, have graffiti on the walls, while others are in move in condition.  You just never know what they'll be like until you go and check them out.

  Below are a few tips to consider when thinking about purchasing a Bank Foreclosure:

1. Find a Realtor®
  Find a real estate agent who you feel comfortable working with.  Your agent can set you up a search for you to receive bank owned homes that are listed on the MLS automatically in your e-mail inbox each morning.  They can customize the search to include your specifics ie. number of beds, baths, zip codes, price range, square feet, etc.  This is a great way to stay on top of the market.

2. Get Pre-Approved
  It's always a good idea to get pre-approved for a mortgage before you start shopping for a home.  It's even more crucial when you're looking to purchase a bank owned home.  Most banks will require a pre-approval letter be submitted with an offer.  Having the pre-approval in hand alows you to move quickly when you find a home you like, which is important in today's market since bank owned homes that are priced well are going quickly.

3. Have it inspected
  When purchasing a home, even if it's a brand new home, it's always a good idea to have it inspected by a professional home inspector.  Inspections are especially important when dealing with homes in foreclosure.  It isn't uncommon for people facing foreclosure to put off routine maintance on their home and often times these homes have been sitting vacant for quite a while.  It is important to know that REO properties are sold "AS IS" and it will be your responsibility to fully inspect the property.  Without a home inspection you won't know the home's true conditon and be able to estimate the cost for the repairs.

These are just a few general tips to keep in mind when purchasing a bank owned home.  For anyone who is thinking about buying a home, today's market offers a wonderful opportunity.  Home prices as well as interest rates are the lowest they have been in years.  There are also tax credits that some buyers may qualify for.  Ask your Realtor® for details!

-Emily Schuyler, e-PRO®

Smart Click Realty

License# 01768964