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Ford Motor Company Homes For Sale. Find a Wholesale Bank-Owned REO in Ford Motor Company, Texas, TX:
Featured Topic: REOReal estate investors are able to buy lender owned REO homes in Southern California for fifty cents on the dollar or better and rent them out for a positive cash flow. 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. Before submitting an offer on an REO it is prudent to for the investor to be pre qualified and clear about their financing. Monthly cash flow attained by purchasing and holding REO's can produce a substantial monthly income. Unlike a traditional purchase an REO buy is as is and the seller will require many disclosures to be signed that absolve them of liability. the buyer must exercise great care in analyzing their purchase. Most economists agree that this in an unprecedented economic downturn and the REO market will create a huge transfer of wealth and assets. It's not unusual for some REO homes in Southern California to receive 15 or 20 offers. Sometimes the bank will throw out all but two offers and then ask the selected buyers to resubmit what is called "Highest and Final" offer. A vacant REO only depreciates in value and is a liability on a banks ledger sheet. Depending on how long an REO has been vacant it can need varying levels of repair from minor cosmetics to serious structural issues. When calculating monthly cash flow be sure to include tax, insurance, management, municipal fees and vacancy costs. Fannie Mae sells each REO property as is, which means that the buyer accepts the property "as is." Fannie Mae is not responsible for fixing any problems after settlement. REO buyers should be aware of the following FHA loan qualification guideline: Credit report should typically have less than two thirty day lates in last two years with a minimum credit score of 580 or higher or no credit score at all. To attract buyer's agents, many banks offer a larger percentage of the commission to the buyer's agent while discounting the REO listing agent's commission. 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. The bank wants to recover as much money as they can on an REO, and will try to sell close to market value in many cases. The REO warranty Home Protect will cover electrical, plumbing, air conditioning and heating systems, as well as ductwork and many major appliances. Freddie Mac will pay for the first two years of the warranty after which buyers will have an option to continue the warranty on their own. It is important to consider quality when buying an REO in this market. A quality home in a quality area in good condition will produce a higher quality renter and improve vacancy rates, cash flow and appreciation over time. This may be more costly initially and take more work to find but will pay dividends at the end of the cycle. Many REO investors do not realize the large number of homes that have gone back to banks but remain unlisted will eventually hit the market and have an impact on price. A common misconception is that foreclosures and REOs are the same. Although they are similar they are in fact different with the REO being the direct result of a foreclosure option sale. An REO is a property that has been foreclosed on and has reverted back to the ownership of the bank or lender. REOs are a safer method of buying a home than foreclosures and short sales, but you might be paying more than you bargained for and be faced with repairs and replacements. To avoid paying more than you intended, carefully research the area and home prices, as well as possible repair costs to find out if a REO home is right for you. |
