Most people aim to own a home at some point in their lives. However, most people cannot afford to purchase homes themselves and so require financing of some sort to help them purchase their property. Financial service providers will approve loans to people who they believe will be able to afford the repayments. However, it is not possible to predict the loss of a job, an unexpected expense like a vet’s bill or something else that makes it impossible for the individual to pay their loan repayments.
When an individual who has taken out a loan to pay for their home fails to make one or more loan repayments, the financial service provider who has serviced the loan will repossess property. After a brief holding period where the financial service provider allows the client an opportunity to come up with the money to pay back the loan. If the client cannot come up with the money, the financial service provider will then have the home sold off to make back what they can of their money, usually through an auction.
Buying a bank repo house could save you thousands:
What are the benefits of buying a repossessed house?
A repossessed home will usually be sold through an auction. An auction is great for buyers because there is no extortionate set price. The potential buyers will determine the price that they are willing to pay for the property. When looking to buy a home, there are always several worries that buyers will consider. The question, ‘why did the previous owners want to sell this property?’ is one that many buyers will stress about the answer to.
Many people will be dishonest about things that might be wrong with the home, for example wood louse or something similar. With a repossessed home, you will be able to rest assured that the home you are thinking of buying has no problems that the previous owners are trying to cover up.
Who offers repossessed houses for sale?
Most financial service providers repossess homes and many financial service providers sell their repossessed homes themselves. Many have systems in place to auction or sell off the repossessed homes themselves while others pass them on to auctioneering companies who will sell them off for the financial service providers.
Find houses for sale under repossession
There are several ways to find repossessed houses for sale including the following:
- Contact your financial service provider
Look the websites of all the major financial service providers you know of or contact them to find out if they have any suitable repossessed houses for sale. Financial service providers that sell repossessed houses include Standard Bank, First National Bank, Nedbank and Absa.
- Look at auctioneering websites
View up and coming auctions on the website of auctioneering websites or contact them to find out the details of the next repossessed house auctions. One of the best auctioneering houses is Aucor.
- Peruse online and print classifieds
Gumtree, Bid or Buy and OLX are just a few of the online classified websites that advertise repossessed houses. Classifieds in print publications and magazines are all places where you might find advertisements for repossessed houses.
What to keep in mind when buying a repossessed house
If you are considering buying a repossessed house it is necessary to be sure of several things. Firstly, decide exactly what property you are looking for and be clear on what is non-negotiable and what you are willing to compromise on.
Secondly, set a budget and stick to it. It is incredibly dangerous to go over your budget and risk getting in over your head with debt. Thirdly, make sure you inspect the properties thoroughly with the help of an expert. Lastly, make sure to buy your property from a reputable dealer.