Interested in REO property or a foreclosure in Lake Worth?
Investing in a bank-owned property is not something to be taken lightly.
For more information, just contact me through my site or e-mail me. I'm happy to address questions you have regarding real estate foreclosures.
What's an REO?
"REO" or Real Estate Owned are properties which have been foreclosed upon and are now possessed by the bank or mortgage company. This is unlike 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 entirely as is. That might include standing liens and even current occupants that may require eviction.
A bank-owned property, by contrast, is a more tidy and attractive transaction. The REO property didn't find a buyer during foreclosure auction. Now the bank owns it. The lender will see to the elimination of tax liens, evict occupants if needed and generally prepare for the issuance of a title insurance policy to the buyer at closing.
Do be aware that REOs may be exempt from typical disclosure requirements.
For instance, in California, banks are not required to give a Transfer Disclosure Statement,
a document that normally requires sellers to tell you about any defects they are knowledgeable of.
By hiring Kearney & Associates International Realty/Keller Williams Realty, you can rest assured knowing all parties are fulfilling Florida state disclosure requirements.
Am I guaranteed a low price when investing in a bank owned property in Lake Worth?
It is frequently assumed that any foreclosure must be a good deal and a possibility for easy money. This isn't always the case. You have to be very careful about buying a REO if your intent is make a profit. While it's true that the bank is typically eager to offload it soon, they are also looking to minimize any losses.
Look closely 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 foreclosures. Still there are also many REOs that are not good buys and not likely to turn a profit.
Ready to make an offer?
Most mortgage companies 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 use a listing agent.
Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and discover as much as you can about what they know concerning 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 unseen damage and retract 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 submitted your offer, you can expect the bank to respond with a counter offer. From there it will be your choice whether to accept their counter, or offer a counter to the counter offer.
Understand, you'll be working with a process that probably involves multiple people at the bank, and they don't work evenings or weekends. It's not unusual for the process of offers and counter offers to take days or even weeks. Kearney & Associates International Realty/Keller Williams Realty is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no undue delays.
Look closely 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 foreclosures. Still there are also many REOs that are not good buys and not likely to turn a profit.
