Where to Find REO Properties For Sale
The REO, or Real Estate Owned, is a type of real estate property that is owned by a bank and is usually being saved for sale to a bank that will take a short term loss on the property. Additionally, as a rule of thumb, some banks will hold on to a REO property for one to five years.
The typical and most common types of REO properties are houses and condos. Usually, large apartment complexes are not held for more than one to two years. Real estate is typically held by a bank until someone buys the property or the property is foreclosed. As a rule of thumb, the bank will lose money on REO properties and will only hold them for short periods, so it’s important to make quick decisions.
Finding REO properties for sale is an easy process. With such a large research base, REO properties are always listed on multiple multiple listing services.
The most common place to begin our search for REO properties for sale is with some of the major multiple listing services.
Online REO Directories
Real Estate Broker
Age Quick Facts:
Real estate brokerages help you sell your house. Before you sell your house, you should hire a real estate broker. The brokerage will help you find a buyer for your house, they act as your representative in order to negotiate the best deal for you and your house.
Most brokerages also specialize in residential and commercial real estate. If you want to find a real estate brokerage near you, there are a number of websites that can help you find a good real estate brokerage near you.
REO Banks & Government Loan Insurers
REO stands for real estate owned which is the property a bank takes possession of when a borrower defaults on a loan.
The banks sell these properties in the public auction and most sellers use REO firms to manage their property and requires REO Agent to find them a buyer.
These REO agents usually refer these properties to multiple buyers, but some buyers might contact sellers directly.
REO agents buy the properties by paying cash on title only. This means they don’t have to go through the expenses and delays of securing loan modifications or litigating home foreclosures. Some of the lender’s expenses involved in repossessing homes are the costs of law firms and the sale prices are usually higher that the face values, even though the REO agent might pay less than the sellers did.
The majority of REO services are not licensed by states and you can get a license for it only if you have a good track record of work. They are not licensed either for that you can get good result from them.
However, REO agents are required to make sure that serious buyers get serious sellers….
REO agents in many cases try to protect their clients from embarrassment and them stepping out of the property after the auction and they often bring in professional buyers who can work with the seller to get out of the situation.
Next Steps After Finding an REO Property
The Foreclosure Process
The foreclosure process, as you know, can be very complicated and convoluted. It’s not uncommon for a foreclosure to drag on for months, years or even decades. To help you understand how the foreclosure process works in general, we’ve broken it down into the following steps.
The process to get your home out of foreclosure begins long before the foreclosure sale itself begins. Real estate professionals can often be alerted to a certain area’s impending foreclosure. These professionals can then be able to make sure that they are the ones being assigned the mortgage, or that they’re finding the most advantageous mortgage rate on the property so that they will have more equity in the home when they finally take ownership, since the homeowner has been sitting on the property, facing foreclosure.
The foreclosure sale is the essential stage of the foreclosure process. At this stage, all of the arrears (that is, the amount of money that is upside down on the mortgage), must be paid in full, or a trustee is appointed to force the sale of the property.
After the Foreclosure Sale
After the foreclosure sale, the property is up for auction, and the highest bidder gets the property, no matter what the final market value is.
A REO property and a pre-foreclosure property have different meanings. On a factual level, they are exactly the same, one that is for sale in the process before they are foreclosing on the property that is worth much less.
So you are looking at a house that is REO, they have come in and performed basic and to-the-point maintenance while the homeowner is still living in this house.
The way this term works is you search your local MLS, Homesearch, Craigslist, ZipRealty, or another website, for REO properties, for sale. A pre-foreclosure is an REO property that is being foreclosed on because the owner went into foreclosure, gone bankrupt, went into rehab, was in the process of the sale of this house.
You will see a lot of REO properties and then you are looking for a pre-foreclosure. When you find a REO property, if it’s in foreclosure, I will tell you to contact the listing agent, who will be able to tell you the circumstances. If it’s an REO property, it’s really in the clear, and you’re looking for this term.
When a person defaults on a home loan, he or she has failed to settle a debt – prompting the lender to initiate foreclosure proceedings. Foreclosure is the process that lenders use to sell foreclosed properties. The property being foreclosed on may still be occupied at this stage.
The home will go to the highest bidder at an auction (though the lender also has the option of putting the property up for private sale to a real estate investor). The pre-foreclosure notice period is the amount of time before the home must be sold; this usually ranges from 30 to 60 days.
If there isn’t sufficient money to satisfy the debt, the bank takes ownership of the property. The lender will keep the home until the debt is settled. This may involve foreclosure proceedings, an auction, or a private sale to a real estate investor (though the bank still retains the option of putting the property up for sale in the open market).
Property Search: How to Search REO Properties for Sale
The process of searching for foreclosed properties has changed enormously over the past decade. At one time, bank owned properties were handled manually. You needed to sift through hours of listings to find the right properties. But with the advent of the internet and fast-paced technology, the process of searching for foreclosed properties has become more streamlined.
So how do you get the best deals on properties? The key is to invest in a quality real estate software. With a few clicks, you can sift through thousands of listings in under a weekend. And to top it up, the forecasted delinquency rate of REO properties is around 2 percent, which means it’s much lower than the national average for properties.
REO Property Search offers a range of foreclosure properties with all the information you need to make an informed decision. With this software, you can quickly find and compare foreclosed properties. You can also view the location, county and zip code, property type and estimated property value. You can compare these properties against most of the criteria you’re looking for – the number of bedrooms, the square footage, condition of the property and more.
Bottom Line on Finding REO Properties
With REO properties for sale, you can expect that the property will have a substantial amount of equity. This is much different than a short sale or bankruptcy sale, where the price is much lower. Additionally, the bank is going to pay you a portion of the sale price for your opinion. The greater the positive appraisal, the higher the amount.
This is generally worth your time because it is not something that is happening every day. The buyer’s agent and the bank are looking to your expertise to ensure that the property is valued at or above the asking price. In some instances, the asking price is actually too low in order to sell the property and the bank will stop the sale and negotiate with you.
The bad news is that the appraisal fee is paid by the lender and not the buyer. This means that your appraisal is done at a loss. The lender or appraisal firm will reimburse you once the transaction is completed, but it can take some time.
After your review, send an appraisal to the bank, the buyer’s agent, and the escrow company. If they follow what you say, they will pay you and reimburse you as soon as you send them the bank statement.
If the sale falls through and the bank does not reimburse you for your appraisal, you will have lost money on that appraisal.