REO Intro
REO (Real Estate Owned ) is property that institutions are forced to hold when a loan that they either issued, purchased, or became legally responsible for was foreclosed on. Generally speaking, an increasing REO inventory indicates increasing foreclosure activity.
REO homes, also known as bank foreclosures , are real estate properties that are owned by a bank. This usually happens after borrowers default on home mortgage loans, causing lenders to buy back the properties at auctions.
REOs, on the other hand, are quite likely to close but may involve some drama in the deal so your efforts and stress are much more likely to result in you actually getting a home. Plus, if you decided to avoid all short-sale listings and all bank-owned properties, in most areas you would have few or no homes left to choose from. REO Allegiance is a nationwide REO services company, dedicated to simplifying the eviction and property preservation process. We understand the complexities involved in successfully moving property from foreclosure to resale and we have developed a service model anchored in collaborative communication and involved, accessible management.
Banks will require a good faith deposit to hold the property in your name. This is typically 1-3% of the purchase price in California for example. Bank foreclosures can be great values, the secret is being there first when the great values become available. Banks are not in the business of foreclosing mortgages; they are in the business of loaning money. Therefore, the bank does not want to foreclose on your home and will make every possible effort to notify that they need your help to work through your delinquent payment issues. Banks will sell to anyone who has verifiable cash funds and credibility. If your not familiar with banks, their method of operation and do not understand the lingo then stay away from courses promoting bulk REO purchases. Banks always want to sell a property in “as is” condition. Most will provide a Section 1 pest certification, but not unless you include it in your offer and negotiate the point.
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