- What is an REO?
- What is a foreclosure property?
- Why is now a good time to buy and REO?
- What are the advantages of buying an REO property?
- Are all REO’s good deals?
- Do all REO’s need to be fixed up?
- Why are REO’s sold “as is?”
- How do I get a good deal?
- How do I buy a bank owned home?
What is an REO?
An REO is real estate owned by a bank or lending institution. The banks, however, are in the business of lending money so they need to sell the property they have acquired to free up funds in order lend more money.
What is a foreclosure property?
When a mortgagee defaults on his payments, the Bank or lending institution tries to sell the
property at a foreclosure auction. The minimum bid at a foreclosure auction is usually the amount owed on the note plus delinquent interest and costs. If the property is not sold at the auction, the bank or lending institution takes the property and it is then known as an REO or Bank Owned Property.
Why is now a good time to buy an REO?
With the recent sub-prime loan crisis and the huge nation wide increase in foreclosed and REO properties, lenders are motivated to get properties sold and off their books.
Why buy a Bank Owned or REO property?
Banks have an obligation to the stockholders of the corporation to maximize the return on a sale so they are like any Seller, their objective is to net the most money as possible from the sale of a property. However, in the current real estate downturn, the Banks are more prepared and capable of adjusting values to the current market than most individual owners. And with the current economic crisis in our country, the largest selection of bank owned homes in all price ranges exist than have in years!
Are all REO’s good deals?
No, but many are. Just because a bank or lending institution is the Seller does not make it a
good deal. As with any real estate purchase, the value of a purchase depends on a Buyer’s
needs and objectives and the property’s price, location, and condition. As a Buyer you always want to do your homework and make a purchase based on knowledge.
Do all REO’s need to be fixed up?
No, there’s a misconception that all foreclosed properties are in need of repair. Just like owner owned properties, Bank Owned properties come in all sizes, prices, and conditions. We have REO properties from tear down to mint condition and in many price ranges.
Why are REO’s sold “as is?”
Since the Bank never lived in the house, it cannot in good faith tell a Buyer what the history of the house’s condition is. An owner is required by law to disclose his knowledge of defects a home had to help a buyer make an informed decision. Since a Bank or lending institution did not own the property previously, it does not have any knowledge of the property’s previous condition.
How do I get a good deal?
Get informed, have your financing ready, check often for new listings and/or price changes (best to sign up with our office for email updates), and be prepared to buy when the right property appears. We can help you find good financing, keep you up to date with properties on the market. It is the prepared, informed Buyer that usually gets the best deals. Our staff can help you get a great buy. Just call or email us if you are interested in becoming a client.
How do I buy a bank owned home?
Browse our listings of bank owned and foreclosure properties, then contact one of our Buyer Specialists today!
