| In today's tumultuous housing market, two phrases that | | | | companies and REO's in general, are a great source |
| are commonly thrown around are "foreclosures" and | | | | of information and guidance. They can give you tips on |
| "REO's." Most people use the two phrases to mean | | | | hot properties and help you negotiate a deal. Second, |
| the same thing, however, that is not necessarily the | | | | get your financing in order. If you need to borrow |
| case. Both are attractive to buy if you know what you | | | | money to purchase, make sure you have a loan |
| are looking at and you know how to get in on the | | | | commitment letter waiting and ready to go. If you are |
| process. With a property that is said to be in | | | | buying with cash, make sure you have proof of funds |
| "foreclosure," that means that the bank has started a | | | | available. These two preliminary steps are vital in being |
| legal proceeding that will take the property to a | | | | ready to move when a hot property comes across |
| foreclosure auction, where it can be bid on and sold. | | | | the market. |
| This is a risky move, though, for most people, and | | | | REO real estate properties are generally priced to |
| rarely results in a bid. After the foreclosure process | | | | move. That simply means that the asset management |
| has been completed, the bank then owns the property | | | | company that is handling the transaction for the bank |
| and it is known as REO real estate. "REO" means | | | | has priced the home below market value in order to |
| "real estate owned," simply meaning that the bank | | | | attract buyers as quickly as possible. Because of the |
| owns the real estate after an unsuccessful | | | | great prices available, there can be a lot of competition |
| foreclosure auction. | | | | for these homes. When you walk through them, you |
| So what are some important steps if you are looking | | | | need to be quick and decisive; you should have a |
| to buy one of these REO real estate properties? First, | | | | rough idea of repair costs and what you are willing to |
| you will probably need to use the services of a | | | | invest, plus what the home could be worth when fixed |
| licensed real estate agent. Agents who are familiar | | | | up, before you make an offer. If you want to make an |
| with local markets, and with asset management | | | | offer, don't delay, because time is of the essence! |