Interested in REO property or a foreclosure in midvale?
Savvy consumers will turn to a seasoned pro when considering a foreclosed property.
What is an REO?
"REO" or Real Estate Owned are homes which have been through foreclosure that the bank or mortgage company currently possesses. This differs from a property up for foreclosure auction.
When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accrued during the foreclosure process. You must also be ready to pay with cash in hand. To top everything off, you'll receive the property entirely as is. That may include prevailing liens and even current residents that may require expulsion.
A bank-owned property, on the contrary, is a more tidy and attractive transaction. The REO property was unable to find a buyer during foreclosure auction. The lender now owns it. The lender will handle the removal of tax liens, evict occupants if needed and generally organize for the issuance of a title insurance policy to the buyer at closing.
Note that REOs may be exempt from typical disclosure requirements. For example, in Nevada, it is optional for foreclosures to have a Property Disclosure Statement, a document that normally requires sellers to make known any defects they are informed of. By hiring Coldwell Banker Residential Brokerage Union Heights, you can rest assured knowing all parties are fulfilling Utah state disclosure requirements.
Are REO properties a bargain in midvale?
It is commonly presumed that any REO must be a good deal and a chance for guaranteed profit. This isn't always the case. You have to be cautious about buying a REO if your intent is make money. Even though the bank is usually anxious to sell it fast, they are also motivated to minimize any losses.
When contemplating the value of a foreclosure, carefully analyze comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. There are bargains with potential to make money, and many people do very well buying and selling foreclosures. Still there are also many REOs that are not good buys and may not be money makers.
Time to make an offer?
Most banks have staff dedicated to REO that you'll work with in buying REO property from them. To get their properties advertised on the local MLS, the lender will usually hire a listing agent.
Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about what they know regarding the condition of the property and what their process is for accepting offers. Since banks most commonly sell REO properties "as is", it's often prudent to include an inspection contingency in your offer that gives you time to check for unseen damage and retract the offer if you find it. If, as a buyer, you can provide documentation showing your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This is generally true for any type of real estate offer.)
Once you've made your offer, it's customary for the bank to respond with a counter offer. Then it will be up to you to decide whether to accept their counter, or make another counter offer. Your transaction could be final in one day, but that's rare. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer. Coldwell Banker Residential Brokerage Union Heights is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no unnecessary delays.
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When contemplating the value of a foreclosure, carefully analyze comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. There are bargains with potential to make money, and many people do very well buying and selling foreclosures. Still there are also many REOs that are not good buys and may not be money makers.
