Sarthak Ahuja Breaks Down How Bank-Auctioned Houses Offer Big Savings for Buyers

If you've ever dreamed of owning a home below the prevailing market price, Sarthak Ahuja explains a little‑known but fully legitimate opportunity: bank‑auctioned properties. These homes often come at steep discounts, primarily because banks list them for recovery rather than profit. When borrowers fail to repay their loans, Public Sector Banks (PSBs) begin auctioning these mortgaged assets to recover dues, creating a window for buyers to get a solid deal.

Why Bank Auctions Offer Discounted Houses:

Banks generally lend based on a conservative valuation, often lower than the actual market rate. When a property enters the auction stage, the bank aims to recover its principal and accumulate interest. This typically results in a reserve price lower than typical market listings, giving buyers a potential 20% or more advantage.

This pricing gap is what makes bank‑auctioned homes attractive for budget‑conscious buyers or investors planning long‑term gains.

Where to Find These Properties:

1. BAANKNET (Ministry of Finance Platform)

All PSBs are mandated to list their auction‑bound properties on this portal.

You can simply pick the city, choose the property category, and browse homes scheduled for auction.

Before participating, ensure you check:

Reserve Price: The minimum acceptable bid. Bids can climb roughly 30% above this level depending on interest.

EMD (Earnest Money Deposit): Usually ~10% of the reserve price; required to enter the auction.

Possession Status: Prefer physical possession over symbolic, as symbolic possession may mean the borrower is still occupying the property.

2. IBAPI (Indian Bank Auction Mortgage Properties Information)

Another government‑backed listing portal. Although the interface is less refined, it still compiles auction properties from several banks.

Due Diligence Comes First:

Before the auction day, thoroughly examine the paperwork with the bank, confirm the property status, and understand any pending dues, legal locks, or municipal issues. A cautious approach ensures that your discounted purchase remains a financially sound decision.

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