In most cases, you will have to prequalify for a loan of a specified amount before you start the bidding on a foreclosed home. Some bank owned properties will sell very quickly and you need to know how much you have to work with before you start offering your bid. If you can pay cash for a property, you might want to finance 25% to 50% of the home’s value. You don’t know all the issues you might run into when buying bank owned properties. Having some liquid capital to make improvements is highly recommended as many of these properties have fallen into disrepair.