| Real estate investing, even in the real estate market of | | | | methods available. But the advantages of buying bank |
| today, is still a way to ensure lasting financial security. It | | | | or government owned REO's is everything has been |
| is a fast and safe method of wealth creation and | | | | taken care of on behalf of the new owner. They are |
| buying foreclosed homes for sale has always been a | | | | ready to go. The previous owner has been evicted, |
| popular investment method. Homes for sale due to | | | | the mortgage is foreclosed so the title is clear and any |
| foreclosures are at an all time high that apparently has | | | | back taxes have also been paid. Basically the bank |
| not been seen in the past thirty years. Foreclosed | | | | clears any liens on the title before they sell it to |
| homes for sale include government homes that have | | | | anyone. Understandably the bargain factor is less than |
| be taken due to failure to meet mortgage payments, | | | | with pre-foreclosure and auction sales but the risk |
| or seizure due to unpaid taxes or other federal | | | | involved is also less, as well as the headache factor. |
| offences. Bank owned homes are due to default in | | | | If you are going to purchase REO homes for sale, |
| mortgage repayments. | | | | make sure that your negotiation techniques are tight. |
| There are various types of foreclosure homes for | | | | Be prepared to swap offers and counter offers. |
| sale. REO, which means "Real Estate Owned" by both | | | | Banks are not in the real estate business, they do not |
| government agencies and banks, default | | | | like playing landlord and want to get their money back |
| pre-foreclosures, which is self explanatory and homes | | | | as quickly as possible. Bank REO's are a burden on |
| for sale at foreclosure property auctions. These three | | | | the liquidity of the bank and they may speed the |
| are the vehicles that many be used by investors to | | | | process up by making terms more favorable for the |
| secure a property at discounted prices. There is also | | | | investor. |
| the short sale but this falls under the auspices of | | | | Bear in mind to always inspect government and bank |
| pre-foreclosure so does not really require a category | | | | owned REO's they are subject to vandalism, |
| of its own. | | | | particularly if they have not been occupied for a while |
| It only takes the non-payment of three consecutive | | | | and this could mean that major repairs are required. |
| mortgage payments for the lender to start the | | | | These homes are for sale "as-is" so always ensure |
| foreclosure process on a home owner. Thereafter the | | | | that a "subject to inspection" clause is clearly defined in |
| lender is legally entitled to call for full payment of the | | | | any offer to the bank, if you have not yet managed to |
| outstanding principle unpaid balance of the debt. | | | | inspect the property, this small clause will save you a |
| There are both advantages and disadvantages to | | | | great deal of trouble in the future. |
| buying homes for sale in any one of the three | | | | |