A Word About Repos
A lot of people are getting some great deals on bank repos, and I want to say a quick word to those of you who think you may interested in purchasing one.
If you will need a loan to make your purchase, you need to get a pre-qualification letter from a bank. If you’re going to pay cash, you need a letter from your bank stating that you have the funds available. Either way, you need a piece of paper from a bank stating that you actually have access to some money. You need this paper before you can even make an offer on a repo. The seller will not even look at your offer without it. (Sometimes you will be required to get a pre-qual letter from the selling bank as well.)
It makes sense to get your pre-qual or your proof-of-funds letter in order well ahead of time. Many buyers think that they we are in a “bad” market, and therefore they have the whole thing all to themselves. This is not the case. Bank repos are often priced very aggressively, and when this happens, the properties move quickly even in a “bad” market. To use myself as an example, I recently bought a lakefront bank repo. I put in an offer the very first day that the property hit the market, and I still only got it because I offered above the asking price. If I hadn’t had all my ducks in a row, I would have missed out.
If you’re looking for a fantastic deal on a repo, get your act together ahead of time. Get your letter from the bank in order. Get yourself a Realtor who will keep a sharp eye on the market and let you know as soon as your dream home is listed. Then be ready to make your offer as quickly as possible. On bargain-basement properties, bidding wars are not uncommon. It pays to be prepared.