Our Services to Buyers
We connect buyers with bank owned properties, otherwise known as REO which stands for Real Estate Owned. REO is just how the bank designates the real estate assets they hold. If you want to know first about our upcoming listings of bank owned property, contact us for an initial buyer meeting. We will discuss your criteria and how the process will work.
What do you need to know about buying an REO?
Many people ask us the difference between an REO and a foreclosure sale. A foreclosure sale happens at the courthouse steps, auction syle, after foreclosure proceedings are finished. The sale begins with with a minimum bid that includes the loan balance, any accrued interest, attorney's fees and other costs associated with the foreclosure process. To bid at an auction of this type you must have a cashier's check in hand for the amount of your bid. If you are successful you will buy the property in AS-IS condition, with no contingency for backing out. You will also acquire the property without assurance of a clean title.
Most properties these days do not sell successfully at auction because the opening bid is often times more than the property is worth. An REO is a property that goes back to the lender after an unsuccessful foreclosure auction, and is therefore bank owned. Bank owned and REO are interchangeable terms. REO (Real Estate Owned) is just how the bank designates their property assets.
How are REO Properties Sold?
Once the bank owns the property and no mortgage loan exists, the bank hires us to sell the property. Most of the time we know about properties several weeks or months before they come to market. The bank will also sell the property in "AS-IS" condition, but, unlike a foreclosure auction, the buyer may have inspections at their cost before closing the transaction. Another benefit of buying an REO vs buying at a foreclosure auction is title will be delivered free and clear of liens when the property closes. Normal title insurance ensures that you are protected from any future liens levied after you close escrow. This added protection is very important.
Many people ask me about the timeframe when buying an REO. All lenders have different policies and timeframes, but usually lenders respond with 3-5 days of making an offer. Also, because lenders want these properties off of their books quickly they will facilitate a quick close.
Financing an REO
Each lender has different policies, but some banks will finance on their own REOs, and often with less money down than other lenders might require. We even have one client that provides 100% financing on their REOs at this time. Some lenders will also accept FHA financing, but it is on a case by case basis and most of our bank clients prefer not to at this time.
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