Making an offer on REO property or a foreclosure in The Bay Area?


	Foreclosed upon and bank owned property purchases require the assistance of an experience professional. Should you have any questions about real estate in Contra Costa County, California, call me or send me an e-mail.

What's an REO?

"REO" or Real Estate Owned are homes which have gone through foreclosure that the bank or mortgage company now holds. This is different than a property up for foreclosure auction. Better Homes Realty has experience to share with foreclosures and bank owned properties in El Sobrante, California

Better Homes Realty has experience to share with foreclosures and bank owned properties in El Sobrante, California

When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. You must also be prepared to pay with cash in hand. Finally, you'll accept the property completely as is. That possibly will consist of current liens and even current residents that need to be removed.

A bank-owned property, on the contrary, is a much cleaner and attractive option. The REO property did not find a buyer during foreclosure auction. The bank now owns it. The bank will see to the elimination of tax liens, evict occupants if needed and generally arrange for the issuance of a title insurance policy to the buyer at closing.

You should be aware that REOs may be exempt from standard disclosure requirements. For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that usually requires sellers to reveal any defects they are knowledgeable of. By hiring Better Homes Realty, you can rest assured knowing all parties are fulfilling California state disclosure requirements.

Are REO properties a bargain in El Sobrante?

It is frequently thought that any foreclosure must be a steal and a possibility for guaranteed profit. This frequently isn't true. You have to be prudent about buying a REO if your intent is make a profit. Even though the bank is typically anxious to offload it fast, they are also looking to get as much as they can for it.

Better Homes Realty has experience to share with foreclosures and bank owned properties in El Sobrante, California

Look carefully at the listing and sales prices of competing properties in the neighborhood when making an offer on an REO. And factor in any repairs or upgrades necessary to prepare the house for resale or moving in. The bargains with money making potential exist, and many people do very well buying and selling foreclosures. Still there are also many REOs that are not good buys and may lose money.

All set to make an offer?

Most lenders have a department dedicated to REO that you'll work with while buying REO property from them. To get their properties advertised on the local MLS, the lender will typically hire a listing agent.

Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and learn as much as you can about what they know regarding the condition of the property and what their process is for accepting offers. Since banks most commonly sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for hidden damage and cancel the offer if you find it. As with making any offer on real estate, your offer may be more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.

After you've presented your offer, it's customary for the bank to counter offer. From there it will be your decision whether to accept their counter, or make another counter offer. Your transaction could be settled in a single day, but that's rare. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.