| There are a number of foreclosure terms and | | | | the property to be sold for a fair price, therefore |
| situations in the real estate market that most people | | | | increasing the likelihood of a quick sale. This is the goal |
| do not understand. It is not until a home owner is facing | | | | of the mortgage company, so they are not incurring |
| a distressed property or foreclosure that some of | | | | any more debt than necessary, or carrying the debt |
| these terms surface. These terms not only affect | | | | for extended periods of time. Many investors look for |
| home owners, but also potential buyers, mortgage | | | | foreclosed or REO homes to turn into a profit. |
| companies and investors. By having a good | | | | Because many of these distressed properties need a |
| understanding of the foreclosure process and | | | | great deal of work, they can make the necessary |
| terminology, it can help save thousands of dollars | | | | repairs and turn a good profit. Some of the homes are |
| when searching for a home. This article will detail REO | | | | in very bad shape and these homes are excellent for |
| properties and how it can help make some money for | | | | investors because of their typically flexible financing. |
| investors or save a buyer thousands of dollars. | | | | In most cases the low price of the home can well |
| REO (Real Estate Owned) is an abbreviation for real | | | | compensate for the repairs and work. Sometimes the |
| estate owned property. When a property is | | | | home needs very few repairs leaving some |
| foreclosed on, it typically goes through a legal | | | | foreclosure properties to be excellent values for |
| proceeding and then is placed for auction. Bids are | | | | buyers with traditionally sticky condition loans. Either |
| taken and the highest bidder gets to purchase the | | | | way, these foreclosure homes are well worth any |
| home. In most cases property is bought during this | | | | efforts to purchase for the investor or buyer. It is |
| bidding process, but occasionally the Mortgage | | | | however, important to inspect thoroughly before |
| Company or bank will not sell the property. In simplistic | | | | purchasing any type of distressed property unless you |
| terms, an REO property is one that has been taken | | | | are an expert at repairs or estimating. The return on |
| back from the home owner, and the bank is now | | | | the investment must be profitable or at a break even |
| stuck with the property. This can place the loan maker | | | | point to make the investment a good one. |
| in an awkward situation and even place a financial | | | | REO properties, HUD or foreclosures can be found |
| hardship on them. It is customary, at this point, for the | | | | through real estate agents throughout the states. In |
| Mortgage Company or bank to place the REO | | | | many Virginia communities there are groups of |
| property in the hands of an experienced real estate | | | | investors or realtors that specialize in distressed |
| agent to sell to the public. | | | | properties. Since the housing market has weakened |
| Upon placing the home with a real estate agent, the | | | | with the strained economy, distressed properties are |
| mortgage company waives much of the fees, interest | | | | abundant. Whether looking for investment property or |
| and other costs that they have incurred. This allows | | | | home to live in, REO's are often great purchases. |