Buying REO / Foreclosures
What is an REO property?
 

An REO property is “Real Estate Owned” by the bank or other lender. Typically, an REO property has already been foreclosed upon and gone to auction without having been successfully bid on. The property is then owned by the bank and is marketed through traditional methods. In Contra Costa and Alameda County, there are a significant number of REO homes currently on the market. This has recently represented as much as 40% of the total inventory of single family homes. If you are in the market for a home, there is a good chance you will be looking at REO property.

 

What are the benefits of purchasing REO property?

 

There are several benefits in purchasing an REO property when compared to foreclosures, short sale property or a traditional purchase from the current owner;
 
  • Banks are not in the business of owning homes. They are Motivated to sell the home and get it off their books quickly.
  • This is a business decision to the bank. There is no Emotion involved in dealing with an REO property. This makes it easier to present and negotiate the offer.
  • Unlike a foreclosure sale, you have time to view the property and get the appropriate inspections.
  • There is less time pressure. You are able to take the time to find the right property and do it in your schedule. You do not have to make a quick decision like you would at an auction.

 Are there issues in buying REO Property?

 

 As with any purchase, there are many issues to consider;
 
  • Not all REO properties are bargains. You need to consider the location, condition of the property, price and other factors when making a decision. You need to evaluate comparable properties in the area to determine the correct value for the property you will be making an offer on.
  • Most REO property is sold “as-is” and it is thus critical to perform a thorough inspection of the property for any defects and damage.

Working with a Licensed Real Estate agent is critical when evaluating an REO property to purchase. You want to work with an agent who knows the local market, understands REO transactions and is familiar with presenting and negotiating an offer to a bank on a REO property. With 400 agents at RE/MAX Accord, we are familiar with what banks are looking for, how they work and the best way to negotiate. Please contact us for an experienced agent that can negotiate a great price on the home of your choice.

 
Learn more at our dedicated REO/Foreclosure site.
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