Buying a bank-owned property can be an excellent option for those seeking an affordable home, flexible mortgage terms or a solid investment. These properties offer several advantages if you know where and how to look.
Key factors include negotiations, the property’s condition and the financing options provided by the lender. Understanding the entire process – from searching to signing – is essential to make the most of this opportunity.
How to buy a repossessed property?
The process of buying a bank-owned property is similar to a standard purchase, but the lender first assesses your creditworthiness. Once approved, the reservation is made, followed by signing the contract and the deed.
Often, the bank provides its own financing, with some cases offering up to 100% of the property’s price.
Where to look for bank-owned properties?
There are many ways to search for repossessed properties:
The most straightforward option is to use the real estate platforms run by the banks themselves. These allow you to search for properties by location, price or type, and provide detailed information on available financing options.
Another useful option is portals like idealista, which show bank-owned flats classified by area or entity.
These homes are also published in the Official State Gazette's BOE auctions, making this portal a reliable source for finding foreclosed homes.
How to view bank-owned homes?
You don’t need to visit the bank’s offices to view foreclosed properties, as most are listed online, often with virtual tours or photo galleries.
However, it’s recommended to arrange an in-person visit to assess the property’s actual condition, check for any needed renovations and see how long it has been unoccupied.
Requirements for buying a bank-owned flat
To purchase a bank-owned property, you must provide a valid ID or passport, along with proof of the source of your funds, demonstrating that the money used for the purchase is legitimate.
How much money do you need in the bank to buy a flat?
One of the most common questions for prospective buyers is about financing. Some banks may offer 100% mortgages, but usually you’ll need around 10–15% of the property price to cover additional costs such as transfer tax (ITP), notary fees, registration and appraisal charges. Therefore, even if the flat itself is inexpensive, it’s wise to have at least this amount available when planning your purchase.
Can the price of a bank-owned property be negotiated?
Yes, but not always. The listed price is not set in stone, and you can make an offer – particularly if the property has been on the market for a while or requires renovations.
The potential discount depends on factors such as location, demand, the property’s condition, and whether it’s currently occupied. Banks may be more flexible if you are financing the purchase through them, which can help reduce the final price.
Advantages and risks of buying bank-owned properties
Buying repossessed properties offers access to cheaper housing, flexible mortgages and often less competition in certain areas. However, there are risks: some properties may be in poor condition, carry outstanding debts, or, in worst-case scenarios, be illegally occupied.
In high-demand cities like Barcelona, Madrid and Valencia, affordable properties sell quickly, while in places such as Burgos, Terrassa or Granada, there is generally more availability.
It’s also crucial to research each market carefully. In Madrid, for example, repossessed flats in Vallecas are notable for price and location, whereas in Seville, Zaragoza or Barcelona, understanding local supply and demand is essential before making a decision.