6 Myths About Buying a Foreclosure Debunked

Are you thinking about buying a foreclosed home in Calgary? Here are the top myths about bank-owned foreclosures debunked and a guide to the truth about buying this type of home.

Many potential homebuyers and investors overlook bank-owned foreclosures, but for buyers who take the time to understand the REO process, these homes can offer a significant opportunity.

Some bank-owned foreclosures come at a significant discount and, if you’re willing to work through some of the nuances of the post-foreclosure market, you can set yourself up for a great deal.

Some of the steps that you have to go through in order to make such a purchase, include:

  • Browse available foreclosure listings
  • Find a lender and discuss REO financing
  • Work with a real estate agent who understands bank-owned foreclosures
  • Get an appraisal on your ideal property
  • Make an offer
  • Have the property inspected
  • Negotiate details

At Mel Star, We Make Buying a Bank-Owned Foreclosure Easy and Stress-Free

At Mel Star, our team of Calgary real-estate experts can provide you with expertise and advice every step of the way when you are buying a bank-owned foreclosure. We have access to many foreclosure listings and our real estate agents have decades of experience in the market to make your home-buying experience as easy as possible.

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6 Myths About Buying a Bank-Owned Foreclosure Debunked

Buying a foreclosed home can offer you a great chance to buy your dream home at a great price, but many homebuyers are hesitant to do so because the process of buying such a home is full of misconceptions.

If you are considering buying a bank-owned foreclosure in Calgary, here are some of the top 6 myths about buying this type of home debunked:

  1. Foreclosures need a huge amount of work: In truth, most foreclosed homes require only the cosmetics (relatively inexpensive) that many new homeowners want to customize anyway, regardless of what type of home they are buying.
  1. Buying such a home is risky: For homeowners who are looking at foreclosures that are bank-owned, which are listed on the open market with other, ‘regular’ homes, this process is no more risky than buying a non-foreclosed home.
  1. Foreclosures are more likely to lose their value than ‘regular’ homes: Whether a home loses its value or not has to do with the dynamics of the local market, including the area’s supply for homes, demand for homes, and interest rates - not with whether the home was a foreclosure at the time it was purchased.
  1. You need to pay in cash when buying a foreclosure: Unlike buying a home at auction, bank-owned homes are bought through a more regular real estate transaction, which means that you’ll likely be able to obtain a mortgage to finance the home just like you would if the home wasn’t a foreclosure.
  1. You can’t get inspections when you buy a foreclosed home: Virtually all bank-owned properties for sale on the open market not only allow, but encourage buyers to obtain every inspection they deem necessary. This is because almost all banks sell the homes as-is, and want to avoid later liability, so it’s in everyone’s best interests to make sure the buyer has full information about the condition of the property before the deal is closed.
  1. It’s easier to buy a foreclosure with bad credit if you get a mortgage with the same bank that owns the property: While many banks offer incentives such as lower fees or closing cost credits for buyers who use their bank for their mortgage, all buyers must meet the same credit, income, and other qualification standards to seal the deal.

We Make Purchasing Your Dream Home Easy

At Mel Star, we have over 40 years of experience in Canada’s Real Estate industry, and we know first-hand the stress and uncertainty that can come with buying or selling a home. Our team of knowledgeable real estate agents hedge the risk associated with this process by providing an all-inclusive, one-stop-shop concierge service for your real estate needs.

To find out more, contact us at (403) 284-6333, fill in our contact form or visit in person at 206-2411 4 St NW, Calgary, AB T2M 2Z8.


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