K.M. Minemier & Associates is a certified Woman Owned Small Business (WOSB) engaged in full service real estate asset management and marketing.


Buying a Bank Owned Property in 2020 is Very Different From 2008

July 15, 2020

Buying a Bank Owned Property in 2020 is Very Different From 2008

By Sandra  C Brown GRI Broker/Owner Dream Catcher Realty


For many years prior to 2008, the bank who made the loan on the house   foreclosed on it if the buyer defaulted.   The same bank  also  sold the foreclosure  property on the open market.  Housing prices were appreciating and the sale of a foreclosure was a break even transaction for the bank.   However during the Crisis from 2008 to 2013 housing prices declined and owners who lost their homes to foreclosure were sueing the bank for virtually any thing they could think of.    This caused the lenders a great deal of negative publicity.  The banks were swamped and in many cases   just sold houses for a fraction of their value to escape owning them The banks instead started a new strategy.  They started selling large pools of non preforming loans to large investors at a discount.  The investors    typially had a two point plan.   The first goal of the investor was for the home owner to bring his loan to current and preforming loan so the investor could resell it as preforming and make a profit.  If this did not work the investor had option B foreclose on the property.   Once the property was foreclosed on the investor could determine which would maximize their profit 1) fixing the house and renting it out 2) fixing the house and selling it or 3) selling it" as is".   These investors buy huge pools of 1,000's of homes at a time. They do this for profit only.  They unlike the bank who make the loan do not mind owning  the house.   The  seller of bank owned properties is making this their business model .  They use several methods to value the foreclosed home  to achieve maximum profit. 

Back To Article List