A bank will foreclose on a home when the borrower has not been able to make the payments for some reason. There are occasions when the lender will work with a homeowner to correct a short term financial issue but if the bank thinks it is not going to get paid then it will foreclose and take possession of the house. The sole purpose for taking the house is to minimize future losses from missed payments and to resell the house.
Once the bank takes the house, their first priority is to sell it and get their money. Some are listed in the newspaper or online for auction. Others are sold to companies which specialize in purchasing foreclosure homes and reselling them. In many cases they invest more in home renovations after the purchase so that they can sell the home for an even greater profit.
If you are considering investing in a foreclosed home, there are a few things to be aware of. Inspect the property very closely to know exactly what you are buying. Most purchases are in as is condition and you want to understand any repairs that you might need to make. It is a good investment to have a contractor visit the home or a home inspection professional to verify all of the aspects of the home that you cannot see. Once you know the condition of the home, make a fair and reasonable offer. The bank needs a certain dollar amount and any offer that is considerably lower is likely to not even rate a response. Once your offer is accepted, secure the home as quickly as possible. Foreclosed homes have become a target for vandalism and destruction when they sit empty for long periods of time.
Buying a foreclosed property in Phoenix, AZ from a bank can offer a great opportunity for a more than fair price. You won’t be dealing with a homeowner who has an emotional or sentimental view of the house. It is strictly about the dollars and the bank wants to get their money and move on. Make a fair and informed offer and you have a great chance to get a house that will prove to be a good investment for your future.