When a bank takes back a home in foreclosure, it becomes an REO and is assigned to a local agent.
Before making an offer on a REO, have your agent contact the the listing agent and ask the following questions: (1) Are there any inspection reports, (2) What work has the bank agreed to, (3) Is there a special "as is" form, (4) How long does it take the bank to accept an offer, and (5) How does your agent deliver the offer?
Conventional financing is available for REO properties but will require a substantial down payment, good fico score and documented income.
Many of Americas millionaires attained financial freedom by collecting cash flow properties and REO's are currently our most abundant source of wholesale deals.
Most offers made on REO properties that contain the phrase and or assigns will not be considered by the bank or the REO listing agent.
Just because an REO has a low list price does not mean it is a great deal relative to current market value.
The only time the deposit check is cashed in an REO offer is when the offer has been accepted.
Most successful trustee sale buyers are very experienced and have advanced research techniques. Many investors find the REO market to be a much safer environment.
Investors wanting to buy and hold section 8 properties must improve the property to comply with section 8 inspection guidelines.
It is important to understand the local economy in your area when considering cash flow over a longer period of time.
Fannie Mae does not warrant or guarantee any work that may have been done on an REO property, whether as part of its efforts to sell the home or pursuant to conditions in the purchase contract
If you are looking to purchase an REO and are unsure what your credit report is like, you may want to begin by getting a free credit report that you can view immediately online.
REO listing agents are typically top producing agents because of the volume of business they conduct.
Many are in fine neighborhoods and offer outstanding values. And while some REO homes do qualify as handyman specials, many are in very good condition.
Many investors shy away from REO properties or HUD homes because they feel they have less negotiating power or simply lack the capital to make aggressive offers and play along with the rules that REO lenders stipulate.
Ask a group of real estate millionaires how they made their money and most will recite some version of this axiom When everyone zigs, you zag. In today’s downward real estate market the axiom simply translates into buying property when most others are not and that’s exactly what REO buyers in Southern California are doing.
The large number of investors buying and renting REOs in some areas will certainly cause a sag in market rents. This should be considered when buying an REO to hold.
Many investors believe that the current drop in Southern California REOs mean that the market has bottomed.
An REO is a property that has been foreclosed on and has reverted back to the ownership of the bank or lender.
What are the benefits of buying an REO property that has been foreclosed on and what are the reasons they failed to find a buyer?
Because of all the unknowns and requirements with foreclosure auctions many people prefer buying an REO. The REO option offers many more benefits and less stress than the foreclosure auction
