| REO properties are bank owned properties that banks | | | | market value, which most REO's are these days. The |
| acquired through a foreclosure process. Usually the | | | | banks are becoming tougher on the negotiations. In |
| bank buys the property back at a foreclosure auction | | | | fact in some areas don't be surprised if you come up |
| if the property does not sell at the auction. | | | | against multiple offer situations. Investors and first time |
| Where to Find REO's? | | | | home buyers are all out looking for bank foreclosure |
| You will find REO properties listed on the MLS with | | | | now. |
| Realtors. Most banks owned properties are marketed | | | | Be able to close quickly. Banks want to close the |
| through a Realtor. Check with a local Realtor, and ask | | | | transaction and get it off their books so don't ask for a |
| them to help you find an REO in an area you are | | | | long escrow period. |
| interested. | | | | Also, make sure you have a pre-qualified letter from |
| Today you can pretty much find REO properties in | | | | your lender as most bank owned properties require |
| most neighborhoods, many of which are luxury | | | | that the buyer provide them with the letter at the time |
| properties as well. | | | | they make the offer. |
| Condition of the Property | | | | Banks sometimes will pay buyer's closing cost so it |
| Most REO properties need some work. Many angry | | | | does not hurt to ask. But if you are in a multiple offer |
| former owners have either stripped the homes bare | | | | situation, then don't risk losing the deal over closing |
| or tried to destroy the home in some way. You will | | | | costs. |
| have to do rehabbing to most of them. However there | | | | If the bank does not accept your offer, and you do not |
| are some that are actually in good condition and need | | | | want to pay their price, then wait a couple weeks and |
| minor repairs as well. So don't be discouraged, if you | | | | then go back and make another offer if the property |
| take the time to look at enough properties, you will find | | | | is still available. There are plenty of foreclosures on the |
| one that meets your criteria. | | | | market right now so you can be choosey. |
| The properties are sold in an "as is" condition. You | | | | Bank foreclosures are hot properties right now |
| must do your own inspections. Generally the banks will | | | | because they are discounted. Expect to do some |
| not make any repairs or give you any credits because | | | | repairs. Title insurance is available on REO properties. |
| the home are already offered at discounted prices. | | | | However there are other properties that are also |
| Negotiating Tips | | | | good deals right now such as short sales and |
| When negotiating with the bank, be prepared to pay | | | | properties with motivated sellers so don't' limit your |
| close to the list price if the home is priced at or below | | | | choices just to bank foreclosures. |