Buyer Beware: Bank Owned PropertyReed Herman
Caveat emptor is Latin for “let the buyer beware” because the principle has been around for centuries. Bank owned, investor-owned, (aka REO Property or “Real Estate Owned”), For Sale by Owner and absentee investor-owned property for sale often present “sweat equity” opportunities for buyers plus they are often listed at a discount price. Although the price may be right, buyers need to be extra careful when buying them for two reasons. As a certified home inspection company, Home Detective can help.
Disclosure Requirements are Different
Bank owned, investor-owned, (aka REO Property or “Real Estate Owned”), For Sale by Owner and absentee investor-owned property for sale are almost always sold “as-is” without a “Seller’s Disclosure Statement.” Sellers that live in a home when they are selling it must report by law issues they have had with it. But, with an “as-is” sale, the buyer is holding the seller harmless for any known/unknown issues with the property. This makes it critical the buyer’s inspection be a rigorous one.
Bank Owned Property is Often Vacant
The picture for this blog is a bank owned property that went on the market in late fall. Like this year, it can get cold fast. The property was not winterized. After the buyer’s offer was accepted, they ordered a buyer’s home inspection and found that the water pipes burst. The main point here is, assuming the bank cleaned up the water damage and put it back on the market “as-is,” a different buyer might not know to look for visible signs of mold or other collateral damage issues. This is why a rigorous inspection is necessary to ensure peace of mind when purchasing a bank owned property.
I don’t want to discourage buyers in any way from considering buying a bank owned, investor-owned, (aka REO Property or “Real Estate Owned”), For Sale by Owner or absentee investor-owned property for sale. They can be and often are excellent opportunities for the right buyer(s). But do a thorough inspection with a certified inspector. Home Detective is certified by over 4 leading trade organizations as a home inspection expert, such as the Midwest Association of Home Inspectors (MAHI), American Home Inspection Training (AHIT), American Society of Home Inspectors (ASHI), and the International Association of Certified Home Inspectors (InterNACHI).
To schedule a home inspection, contact Reed today online or call (763) 434-3155. All of our homes inspections come with a 90 Day Warranty with very affordable options for an 18 month extended warranty. Home Inspection Brainerd | Certified Home Inspector Brainerd | Buyers Home Inspection Brainerd | Home Inspection Warranty St. Michael | Home Inspection for Sellers St. Michael