How to Buy Foreclosed Homes From a Bank

Bank-owned properties make attractive investments.

Foreclosures offer willing investors a chance to buy otherwise unaffordable homes. If you know how to buy a foreclosed home from a bank, you may use the property as a residence, investment property or rental property.

Obtain a List of Foreclosures

You may acquire a list of foreclosures from your real estate agent or the bank's real estate owned department, also called the REO department. Either may provide you with a list of bank-owned properties.

Research the Areas

Research the areas where the homes are located. A home located near lots of crime and little opportunity may be a bad investment for someone seeking to live in or resell the home. An exception is an area with long-term potential for improvement, if you can afford to hold onto it for a while.

Inspect the Home

Inspect the home for problems that may undermine its value. Issues arising from poor plumbing or termites are costly to repair and will be difficult to ascertain without an inspection.

Fax Your Offer

Fax your offer to the bank's REO department. The REO department will review your offer and either accept it, reject it or make a counteroffer.

References

• Federal Citizen Information Center: Bank Owned Homes

Resources

• Bank of America: Find a Bank Owned Property