It is the main purpose of a bank is to make money. The financial world banks on the fact that the banks will keep making money so that they can then turn around and turn this money into loans for other projects. When a bank takes on a house as a foreclosure property because someone defaults on their loan, the first thing that they try to do is make their money back on the property. This can be done in a few different ways. The bank may auction off the property, they may try to list it for a profit on the market, or they may if the home is not selling take it off the market and sell it to an investor to flip.
If the house is auctioned off, you as the investor will have a good chance of getting it for well below market value, which would mean a lot more of a profit for you. The bad thing about a home that is for auction is a potential bidding war between two or more investors that could drive the price of the home up to way more than it is worth. A bidding war is the main reason that banks auction off the properties that they own. The second best thing that an investor can hope for is the house to go on market and then not sell. The bank will eventually get to the point where they go into recovery mode. This means that they will take what they can out of the property.
The best way to go about buying a bank owned property is to check with the bank . Ask them about any homes that they currently have on the market. If they tell you that they have properties ask them the prices of the properties and make sure to get the lowest price that they would be willing to take. If the property is up for action make sure that you get the opening bid price from them and the place and the time of the auction. If you are lucky enough you will make huge profits off of every bank owned property that you invest in.
Source by Alex Nghiem