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Alpena County, Michigan Homes For Sale. Find a Wholesale Bank-Owned REO in Alpena County, Michigan, MI:
Featured Topic: REOThe prices on current REO inventory are well below building cost and make incredible buy and rent opportunities. Most foreclosure auctions do not result in bids because, if there was enough equity in the property to satisfy the loan, the owner would have probably sold the property and paid off the bank. Many times homeowners get in over their heads when it comes to purchasing a new home. If they have taken out a loan from the bank and are unable to make their payments their home will be turned over to the bank. From there the bank will place the property on the market for auction or sell. These types of properties immediately become REO Properties and are generally a steal to catch. Positve cash flow is attained when the monthly collected rent minus expense exceeds the mortgage payment. In experienced REO buyers that can not follow through on their offers, make many agents leery of working with investors. Buying cheap cash flow REO's in bad areas will mean lower rents, higher tenant turn over and increased property management hassles for the hold investor. The use of weasel clauses in an REO purchase shows a lack of confidence on the buyers part and should be avoided when making REO offers. REO vs Short Sale. The bank will list its REO property with a real estate agent who is much more likely to understand market value than a banks loss mitigation department in a short sale. An REO investor must take care to properly evaluate the condition of a listing and compare that with the standard of the active, pending and sold comparable homes in the area. Local unemployment stats should be factored in when determining cash flow on an REO property. Even if an REO has fresh paint, brand new carpet, new appliances, perhaps even a new roof or siding, it doesn't mean everything in the house is new, or even works. REO buyers should be aware of the following FHA loan qualification guideline: Last two years Income should be the same or increasing. Remember that these guidelines are subject to change at anytime and you should stay abreast of current loan programs. If the bank won't budge and you receive an offer rejection, wait another 7 to 30 days and then resubmit your original offer, with the original date crossed off and your new date inserted. Banks may require a cash REO buyer to show proof of funds. This rules out obtaining a refinance on a residence unless the money is already in the bank. REO for stands for real estate owned and REO homes are houses which have been subject to foreclosure, but failed to sell at a foreclosure auction. Purchasers of single-family foreclosed REO homes offered through Freddie Mac’s HomeSteps division will receive a comprehensive two-year home warranty paid for by Freddie Mac, the company announced Monday July 20th. When looking for the cheapest REOs, an investor should go out and really see the areas and inventory. Usually there is a reason for the low pricing. That does not mean that there are not super deals but the listing agents are pricing according to area, desirability and condition. They are looking to dump the house quick and you don't want a lemon REO. REO tip....take extra care to estimate repair costs on the lower priced inventory. There is usually a reason for the low list price and many times it is a costly or loan killing defect. 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? Savings of 20% to 30% off the fair market value are absolutely possible, making an REO purchase the best way to buy a property for the first time home buyer or property investor. They give prospective buyers immediate access to the property for inspection. They remove all liens and back taxes. They allow negotiation on all rehab costs, interest, closing points and loan amounts. The purchase is described as 100% risk free and they may allow a less than normal down payment. The bank will also evict the tenants if necessary. So you can see the benefits of of buying REO properties. In today's housing market the glut of foreclosures has created a rare investment opportunity for those who know what they are doing. |
