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Buying REO property or a foreclosure in BROWNWOOD?
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Savvy consumers will turn to a seasoned pro when considering a foreclosed property.
For more information, you can contact me through my site or e-mail me. I'm happy to address questions you have regarding real estate foreclosures.
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What is an REO?
"REO" or Real Estate Owned are properties which have gone through foreclosure that the bank or mortgage company presently owns. This differs from real estate up for foreclosure auction.
If you buy 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 get the property completely as is. That may consist of standing liens and even current tenants that may require eviction.
A bank-owned property, by contrast, is a more tidy and attractive transaction. The REO property was unable to find a buyer during foreclosure auction. The lender now owns it. The bank will see to the removal of tax liens, evict occupants if needed and generally organize for the issuance of a title insurance policy to the buyer at closing.
Note that REOs may be exempt from typical disclosure requirements.
For example, in California, banks do not have to give a Transfer Disclosure Statement,
a document that ordinarily requires sellers to make known any defects of which they are aware.
By hiring MCCLUSKEY & ASSOCIATES REAL ESTATE, you can rest assured knowing all parties are fulfilling Texas state disclosure requirements.
Am I assured a good deal when investing in an REO property in BROWNWOOD?
It's commonly presumed that any REO must be a good buy and a possibility for guaranteed profit. This isn't always true. You have to be prudent about buying a repossession if your intent is make a profit. Even though the bank is often anxious to sell it quickly, they are also motivated to get as much as they can for it.
When pondering what to pay for REO property, you need to look closely at comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale.
There are bargains with potential to make money, and many people do very well buying foreclosures. However there are also many REOs that are not good buys and not likely to turn a profit.
Ready to make an offer?
Most lenders have staff dedicated to REO that you'll work with while buying REO property from them. Typically the REO department will use a listing agent to get their REO properties listed on the local MLS.
Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about their knowledge regarding the condition of the property and what their process is for accepting offers. Since banks most commonly sell REO properties "as is", you may want to include an inspection contingency in your offer that gives you time to check for unseen damage and terminate the offer if you find it.
If, as a buyer, you can provide documentation proving your ability to secure financing, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any real estate offer.)
Once you've presented your offer, you can expect the bank to respond with a counter offer. From there it will be up to you to decide whether to accept their counter, or offer a counter to the counter offer.
Your deal might be settled in one 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. MCCLUSKEY & ASSOCIATES REAL ESTATE is accustomed to these situations and will work to ensure there are no unnecessary delays.
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