Mar
2023

What Makes Bank Owned Foreclosures One of the Most Favored Real Estate Investments?

In the current times, the real estate market is seeing some interesting new trends with home buyers favoring bank owned foreclosures over standard properties on sale. One of the major reasons for this shift is the plummeting values of foreclosed properties which are hovering around nearly half of their actual market prices. Other aspects that have made bank owned foreclosures highly favorable amongst home buyers is their wide range of housing options, modest asking prices, safe transaction procedure, easy loan facilities and higher chances of negotiation.

Bank owned foreclosures are also known as REO properties and have gradually become one of the best investment options in today’s real estate market. At present these properties are mostly attracting first time home buyers who have been encouraged by their heavy discounts as well as several incentives for buyers. As foreclosures have swept throughout the country it has resulted in a large number of high end houses being reclaimed by banks over the past few months including top residential communities of Florida, Miami, Arizona and California. As the banks are very keen on recovering their losses they are putting up these houses at heavy discounts in order to attract buyers and clean their inventories.

Another major reason for the popularity of REO properties is the availability of a wide range of housing options under these foreclosures. Home buyers can take their pick from a multitude of modestly priced small homes and condominiums, to three bedroom family apartments and penthouses. The fact that these properties are located in some of the prime residential communities in the country has made them a very lucrative investment on the whole.

When it comes to bank owned foreclosures, they make for a very safe and sound real estate investment as all the properties reclaimed by the banks are cleared of liens and back taxes before being put in the market for sale. The buying process is also very transparent and ensures the home buyers a risk free investment. While most banks sell their foreclosed properties through real estate agents some of them also put them out for sale through auctions which are also a great platform to find and bid for some great bargain deals.

Apart from offering heavy rebates on REO properties, these banks are also helping home buyers in picking up suitable foreclosed homes through easily available bank loans. The housing loans have special schemes for buyers of foreclosed properties and are being floated at very low interest rates. Moreover the loans are also flexible which will help the buyers in making any modifications in the repayment plan in future. With the great price and housing features being offered by bank owned foreclosures it is no wonder that they have become one of the most favored real estate ventures in the present times.

Sep
2022

Swiss Banking Alternatives

We’ve all heard a lot recently about the supposed downfall of banking privacy in Switzerland. I’ve personally been contacted by many clients of UBS who have been notified that their Swiss bank accounts are being closed because of the recent scandals in the US.  Many clients undoubtedly chose UBS thinking it was “too big to fail,” or maybe just because they had hundreds of sales reps in the USA, not realizing that UBS was also “too big and too exposed.”

UBS actually describes itself on its website as “one of the world’s leading financial firms”…  and therein lies the problem! It’s not really a Swiss bank at all… it’s a global bank just like JPMorgan or Citigroup.

All the signs are saying that Credit Suisse will have similar problems soon too. If your money is in Credit Suisse, you have been warned! It’s too easy for foreign governments to put pressure on big international banks to give up their secrets.

So what are you to do if you want to bank in Switzerland? For starters, you could go for either one of those ultra-discreet private banks. They are so discreet they don’t have websites, they don’t even have their names outside their offices. But they are certainly a dying breed. Besides, they are overrated in my view – charging enormous fees for service that as a sophisticated investor you probably don’t need or want. In the last few years many have been taken over by bigger banks like UBS and the large Swiss Private Bank Julius Baer.

A better option in my view would be one of the Swiss Cantonal banks. These are banks owned by Swiss local governments (cantons) which means they are both very strong, and very focused on their local markets. They are good for three reasons:

1. They don’t have too many overseas clients – that makes them less of a target in the first place for foreign governments.

2. They often don’t have any offices outside Switzerland – which makes it much harder to apply pressure on them

3. Being associated with the government gives them additional political clout.

Many little cantons have their own banks and the best way to open accounts with them is to get on a plane. If you feel like paying a sizeable fee for a referral, a company called Micheloud & Cie has made quite a business out of bank introductions and is currently busy promoting Cantonal Bank accounts.

One of the bigger Cantonal banks, for example,  is Zuercher Kantonalbank, from Zurich. Here’s a link to ZKB’s Private Banking division, but the site is only in German. I’m sure they speak impeccable Englis – but not having English language publicity on the internet is undoubtedly  a calculated decision about the clientele they are seeking. You probably need a good local referral and a sizeable deposit to get in the door, but this is the kind of Swiss bank you should be looking for if your aims are privacy, class and good service at a fair price.

Many Swiss banks, of course, will no longer accept accounts from US or EU citizens at all. Who can blame them, given the recent pressures. In this case it may be necessary (and a darn site better privacy wise) to look for alternatives outside Switzerland. Neighboring Liechtenstein is no longer desirable, given that it is signing agreements with the US treasury and is working on a ‘swift agreement’ with UK tax authorities amongst others.

Austria is known as “where the Swiss go for private banking” and indeed Austrian banks have world class wealth management services. However, their membership of the European Union could be a problem. Austria is also a great place to buy gold bullion offshore.

Indeed I think to find real banking privacy today it is necessary to go further afield. Not so much to specific countries, but to banks that realise that jurisdictional arbitrage is one way to enhance their clients’ privacy. The modern boutique private bank will have highly qualified private bankers who are able to open accounts at subsdiary banks in several different jurisdictions. As an additional layer of both privacy and asset protection, offshore corporations and foundations are always a useful way of handling offshore accounts too.