For the most part, purchasing a Bank Owned property is very similar to purchasing a traditional property. Here are some important steps to take into consideration. Being prepared, in my opinion, the most important step.
1) Decide on the location where you are interested in purchasing a home.
2) Research, research and research neighborhoods. Drive around the community to have a feel of the area. Speak to neighbors, they provide valuable information. Find HOA contact information and have a chat with them. Request HOA documents.
3) Keep an eye on new listings in the area you are interested in. We can notify you instantly with new Bank Owned properties when they reach the zip code you are interested in.
4) After you have located the Bank Owned property, making an offer is a pretty simple process. We can prepare the paperwork for you.
We offer an electronic digital signature to our clients in order to speed up the process and we do not charge transaction fees.
- For Cash Buyers, the bank is going to request proof of funds such as a bank statement,or a letter from the bank verifying funds to purchase the property.
- For Mortgage Buyers, the bank is going to request a pre-qualification letter from your lender. Some Banks, such as Wells Fargo for example, will ask you first to pre-qualify with them and then you can choose whoever you want as your primary lender.
- If you are an investor and buying a home under your corporation, the bank is going to request the articles of incorporation.
5) What should I offer?
- First and foremost, you need to find out if there are multiple offers. If it’s a “hot” property and there are multiple offers, Bank will request highest and best from all parties who have submitted an offer which often creates a bidding war and property end up usually selling above asking price. This is very common among condos who are priced low.
- Evaluate the recent sold comparables in the community that have sold within the past 6 months. You can easily determine the market value of the property. We can send you all the info.
- Terms of the offer are equally as important. Cash transactions are more attractive to seller since they offer a quick close. The higher the escrow deposit amount the better.
- Make an offer based on the recent sold comparables. Evaluate also properties under contract in the community and how many listings are currently available.
6) Offer accepted! Seller will select a closing title company who will process the entire transaction. The closing agent will work closely with all parties in order to ensure a smooth closing. Delays are very common but it is in your favor since the seller and closing agent are simply looking to make sure everything is done correctly before closing the deal. For example, paying past HOA dues.
7) Inspect the home. I have 3 licensed home inspectors that I can recommend or you can choose one at your discretion. Bank gives you the opportunity to order any inspections that you may find necessary. They will usually give you 10 days after the offer has been accepted.
8) Shop for home insurance. We can recommend local companies or you are welcome to chose anyone. You can also purchase a home warranty. I usually recommend American Home Shield.
9) If you are using a mortgage, work closely with your loan officer and provide any necessary documents they are requesting. Your lender will also work closely with the title company closing agent. After your loan is fully approved and you have the clear to close, the closing agent will prepare the necessary documents to close the deal. During the close day, you need to bring 2 forms of Valid ID’s and cashier’s check. If you are an investor purchasing Cash, the closing is very simple. The closing agent will email you the documents that need to be signed and wiring instructions for the funds.
10) Congratulations. You are now a new Home Owner in Central Florida.