Buying a Foreclosed Home in 2020

Are you thinking about buying a foreclosed home in Calgary? Here are some of the risks and rewards of purchasing a bank owned home in 2020.

When a mortgage borrower fails to make their monthly payments as agreed upon, a lender may seize the property and sell it to a new buyer to help recover the mortgage balance. This is called a foreclosure.

Quick Facts About Home Foreclosures

  • They happen when a homeowner stops paying his/her mortgage.
  • Banks and government agencies sell foreclosed homes to recoup their financial losses on them.
  • You can purchase a foreclosed home at an auction, or directly from the court (as a judicial sale), bank and agencies.

Our Top Calgary Realtors Can Help You Find a Foreclosed Home at Great Value

Do you want to buy a foreclosed home, but you don’t know where to start? Are you having difficulty negotiating a price for your new home? With the Mel Star Team, our top Calgary realtors can take care of all these details so you can focus on what matters most: finding a dream home for your family at great value.

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Risks and Rewards of Buying a Foreclosed Home in Calgary in 2020

As much as you might want it to be true, there is no such thing as having your cake and eating it too. Buying a foreclosed home in Calgary is no exception.

That’s why it’s always best to work with a Calgary realtor during the process, and to do your research beforehand, to ensure you are mitigating any risks and getting the most value for your money.

Here are some of the risks and rewards of buying a foreclosed home that you must be aware of:

Risks of Buying a Foreclosed Home

  • Lack of knowledge of the home’s condition: One of the biggest risks of buying a foreclosed home is the risk of not knowing the interior condition of the property. This is because when buying a home at a house auction, potential buyers aren’t allowed in the house before the bidding begins.
  • Underestimating the cost of potential repairs. There are many people who have bought a foreclosed home and then suffered from the miscalculation of potential repairs and ended up with a bad return on investment. That’s why it’s always best to consult with a realtor before moving forward.

However, everything has an upside and there are some great rewards of buying a foreclosed home, if you do it right. These include:

  1. You can find great deals. While some foreclosed homes might require a lot of extra money to fix up, others can be purchased below market value. Working with a realtor will ensure the due diligence is done and you’ll get the best return on investment.
  2. You can add value with sweat equity. If you have the time and skills, you can do a lot of repair work yourself, saving money instead of contracting the labour out. This ‘sweat equity’ will mean extra profit when it comes time to sell.
  3. Faster purchase. The bank is often motivated to sell the property, and this means that you might be able to negotiate the price, down payment, closing costs, and escrow length.

Call The Mel Star Team!

With over 40 years of experience in the Canadian real estate industry, our team of realtors know first-hand the uncertainty and difficulties that can come from buying a foreclosed home. We use our experience and expertise to make this a seamless and stress-free experience for you, and to ensure that you get the best deal on your new home.

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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