Is buying a repossessed house a wise purchase? The answer to this question is yes. Especially if you are looking for a new home but do not have large amounts of money to spend. Property prices always rise and fall depending on the market. Therefore, unless you are in the know it can be difficult to find a good property that is both in your price range and is the best property for you.
Read More: Auction Houses South Africa
Therefore you can look in to repossessed properties as a way to find something that matches both your financial and space needs. If you are not sure of what a repossessed property is then SA Home Loans gives an explanation:
Repossessed houses are properties being sold by loan providers to recoup the finances lost owing to a defaulting lender. Because some homeowners are unable to keep up with their financial responsibilities, loan providers are forced to resort to repossession.
Buying a Repossessed House at Auctions
If you are wondering where to find out about these repossessed homes, then there are two routes for you. Firstly, bank repo auctions.
These are public auctions that are held weekly by banks. Banks that are looking to get back the money owing on a property. Which someone purchased through the banks. For instance, they applied for a home loan.
Although it is unfortunate for the person whose house has been taken back by the bank, it is necessary for the banks to reclaim the money outstanding.
The best thing about these properties is that because the bank is only looking to recoup the money owing… They are auctioned off well below market value.
There are certain things to know about bidding on property at an auction event. And the following video shows you how not to do it!
Video on how not to bid at a bank repo property auction:
Should the bank not be able to obtain the minimum price required on a property. Then some private organisations such as SA Home Loans will purchase the properties. And they will sell the properties on auction directly to the public themselves.
SA Home Loans deals only with residential properties and these include both houses and apartments. This organisation has realised that people who are looking for new homes may not have the means to buy their dream home. Due to increasing property prices.
They therefore offer these repo homes to their clients. If you are still wondering if buying a repossessed house is a wise purchase. Then here are some reasons that SA Home Loans list as reasons why it is a wise decision.
- You get great prices and deals on these homes as SA Home Loans are only hoping to recoup the market value of the property.
- You do not have to pay transfer fees on the property as the seller of a repossessed home has to pay VAT. Therefore you are exempt from paying the transfer fee which would normally cost you thousands of rands.
- SA Home Loans are liable for all the rates and taxes. As well as any other Municipal levies charged on the property. Up until the point at which they sell the property. This is not normally the case if you had purchased a home in the traditional way. Because you are liable for these fees even before you take occupancy. If you however purchase a repo home through SA Home Loans. Then you only have to start paying these fees once you have taken possession of the home.
SA Home Loans – Another Option
If those three reasons aren’t enough for you. Then why not contact SA Home Loans and let them explain the other great benefits that you can receive from purchasing a repo home from them.
You can call one of the property finance consultants on 0860 246810. In addition to informing you about the benefits. SA Home Loans will advise you on how to avoid falling victim to the pitfalls of purchasing a repo home.