Mortgagee Properties

MORTGAGEE PROPERTIES FOR SALE IN AUSTRALIA

A mortgagee property for sale, often referred to as a bank-owned property or REO (Real Estate Owned), is a property that the lender has repossessed because the mortgage was not paid. The bank typically sells these properties through auctions or directly on the real estate market, often at a reduced price to recover the unpaid loan amount.
 

Mortgagee sales present a lucrative investment opportunity for the savvy property investor. Banks tend to try to unload properties as quickly as possible, so anywhere lenders or administrators are involved, you have a real chance of landing a bargain.

A mortgage holder sale (also known as a mortgagee-in-possession sale) occurs when a homeowner ceases making payments to the lender. The lender will look to recover the loan by taking possession and selling the property.

WHY BUY MORTGAGEE PROPERTIES?

Mortgagee sales are a great place to land a real estate bargain and find "realy cheap homes for sale". On average, this type of forced sale can be 10% below market value, and in some cases as much as 50% below.

Despite the opportunities for a bargain, banks and lenders must follow clear guidelines to ensure the property has every opportunity to sell for its fair market value.

The property must be independently valued and the auction adequately advertised to ensure a visible public sale. Essentially, the mortgage holder is obliged to act in good faith when exercising the power of sale.
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Despite this, there are still mortgage holder bargains to be found. Banks and lenders tend to be motivated sellers looking to wrap up a sale as quickly as possible. Additionally, many bidders for these properties will also be conservative in the hopes of landing a bargain and finding a "properties fro auction"

WHAT ARE THE RISKS OF MORTGAGEE SALES?

While property bargains are to be had, some risks are associated with purchasing at mortgage-holder auctions. These risks are litsed below.

• You will likely be buying the property as is, which can mean there is no opportunity to terminate the deal or renegotiate the price if building and pest inspections aren’t satisfactory  
• The lender may not be obliged to acknowledge issues with the property or may not be aware of them
• Clear title may not be guaranteed if the registered owner owes money to secondary lenders
• The lender may not be required to remove chattels or rubbish from the property
• The lender is not required to disclose information about codes of compliance, building permits or property boundaries
• There may still be outstanding outgoings like council rates or body corporate fees.
• The property may not be in a desirable or high-growth area

SIGN UP TO REDA TODAY

The REDA system crawls Australia’s biggest and best real estate websites and gathers listings for mortgagee properties for sale.

Once you subscribe, you’ll be able to browse the householder auction listings, find really cheap homes for sale, filter "really cheap homes for sale" by your preferred parameters, and find a bargain.

Whether you’re a seasoned investor looking to add to your portfolio or you’re just starting out and looking to buy your first investment property, the REDA platform makes finding high-potential properties easy.   

Subscribe to REDA today and get a free 30-day trial that unlocks all features and allows you to browse and filter all our property listings.
 

To start browsing our comprehensive mortgagee auction listings, sign up today for a free 30-day trial. You’ll get immediate access to all our premium features including our complete database of under market value and off-market real estate listings, our expert property investment resources, and more.

You can also call our team to learn more about how our platform can help you find an investment property suited to your strategy and your portfolio.