10 tips for Buying Bank acquired Repo Property
1) Whether you’re buying a home to live in Australia or you’re buying an investment property to let out, you need to check the property in light of your expectations of it and for it. I.e., if you’re going to be living in it, is it located in a neighbourhood that suits you, if you’re going to be renting it out, does it have the space you need, does it match your target rental market’s requirements for it?
2) Find out what the Bank value of the home is – and focus on this. Is this a value you are comfortable paying for the property – could it be worth a lot more than the listed price?
3) Scrutinize the state of the property externally and internally. Look at everything from the foundations to the roof, from the electrics to the plumbing. Is there dry rot? Termite damage? Will you need to redecorate or renovate? Factor in all of the extra costs you will incur if you are successful in your purchase. Add this on to the expected auction price and see whether the home still looks like a bargain.
4) Get surveys and checks done if you are very serious about the property but you are unsure about its true state – remember, a few dollars spent at this point on such matters could be thousands of dollars saved down the line.
5) If you decide to use a broker to search and/or bid on homes for you, check up front what their commission will be and how you have to pay it. Check if you can bargain or lower the commission.
6) Before you begin bidding on the property at auction, be sure you know how the process works, when you will be required to pay a deposit and when the final sum will need to be paid.
7) Think carefully about using a professional to bid for you – they won’t go over your budget, they won’t get carried away by the excitement of the bidding war.
8) Know that the auction process can be fast and furious and that you may find yourself bidding against determined buyers with deep pockets. Be ready for your lot, have your ceiling and stick to it.
9) If you are successful at auction – congratulations – now check that all the paperwork is 100% in order with the sale. Use a solicitor.
10) Be patient, even though it seems to all happen so quickly up to this point and you are required to have your money in place and be ready to go immediately, you are buying a home from a bank at the end of the day, and as you well know they are slow moving beasts and they can drag out the final handover process.