There is a rise in the number of foreclosed homes in VA over the last few years, especially bank owned homes in Virginia. While there are certain benefits and drawbacks to buying foreclosed properties, this gives way to interested home and investment property buyers looking to get properties below the market value. If you are interested, take the time to learn about the process and what you can expect to make the sale as smooth as possible.
Benefits of Buying Foreclosed Homes in VA
With so many options for housing developments and residential buildings in Virginia, why would you want to consider buying foreclosed properties? Below are some of the benefits to ponder on:
- It is a good option for home buyers looking for a good deal. Most banks would want to be able to sell the home and make a profit for it so they are likely to approve qualified applicants faster than traditional mortgages.
- It puts you in a good position to make money when you decide to sell it later. The property has already accumulated equity and you buy it under the market value, which could mean more profits in the long run.
- It comes with lower mortgage payments.
- It is a potential investment project if you want to develop an income property.
- It gives you access to better financing and lower closing costs.
Requirements and Qualifications
Are you ready to buy bank owned homes in Virginia? If you are interested in a foreclosed home, the most basic qualification is for you to meet the financial standard that is set by the bank or lender (which depends on the market value of the property). Make sure to check with the bank with regards to the minimum income requirement and that you have a stable income source. This is important since the bank wants to make sure you have the capacity to pay the mortgage, along with the utility bills and property taxes.
A real estate agent can help simplify this process for you by compiling the list of requirements to buying foreclosed homes. If possible, choose an agent who specializes in bank-owned properties within your state or city.
How to Buy Bank Owned Homes in Virginia
Before you proceed, it is important that you inspect the property before making an offer. This is a necessary step to ensure that the property is in good living condition. Since most foreclosed homes might be older than the new ones in the market, issues might arise once you move in. This is the last thing you would want because it entails additional cost on your end.
Once you find a real estate agent to work with, you can proceed with the rest of the steps to buying a foreclosed home. Your agent will provide you with a list of documents and requirements that you need to submit to the bank. You will draft a pre-approval letter with your agent along with your bid for the property. Make sure you have adequate cash on hand to pay for the down payment of the bidding price on the property. If your bid is accepted by the lender, you must pay the down payment (usually 10-20% of the total value of the property) within the specified period (around 30 days from the time you are notified of the winning bid).
Your real estate agent can help close the sale within a month. This will give you time to process all other needed documents required by the bank to finalize the sale.
Foreclosed properties are a rising trend in the VA housing market. Whether you want to get a home for a cheaper price tag or you want to get better financing deals, consider this option and see if it is a good fit for your needs and budget.