A bank owned or an REO property is under the ownership of the bank after the property fails to attract buyers in a foreclosure auction. The bank management pays off property taxes and makes some repairs.
The bank owned properties are usually advertised for selling, but advertisements are not the ultimate source of REO deals.
Hot properties are sold before they are even listed in the MLS. You might never know about an REO property unless an investor rehabs and sells the property. REO properties are a huge part of San Francisco housing market. As an investor, you must remain informed about any such properties and foreclosure auctions.
This article is written to help you find hidden REO properties.
MLS listing is not the best choice, but the first one when it comes to finding REO properties.
Experts know how to sort out MLS listings. They also have connections and can tell you if an REO property is expected to be sold in the next month.
General public doesn’t have complete access to this service. Work with an experienced agent and he will show you required REO properties.
Banks are smart. They are dealing with assets, and they know how to play the game. That’s why it’s hard to get REO properties at a low price.
Most banks have an online listing system where new properties are regularly added. Some examples can be:
Use their websites for an introduction. Meet with the head of the department if the bank has a separate section for dealing with REO properties. You can contact this person for an initial price quote and to inquire about the home condition.
The banks were not designed to deal with foreclosure properties. The lender will lose money as long as the property is sitting as an REO. It is best to put the property back into the market as quickly as possible.
For this reason, some lenders work with Asset Management companies. Asset management companies hire top notch REO agents. The agents use their network resources and latest technology to sell the home. Agents sell properties, and the chapter is closed at the moment.
Search the online directories to find contact information of REO asset managers. It will be great if you already know someone in the company.
Govt. agencies have their way of dealing with foreclosures. It is better to work with a real estate broker before you try making an offer. Some of the biggest national agencies are:
Sometimes banks hold the auction to sell several properties at once. A few companies specializing in REO sales are:
These auctions have real estate gems. Other foreclosure auctions usually have distressed properties. The homes are sold “as-is” without any guarantee.
When a bank arranges an auction, it is usually their last attempt to sell the property quickly. The property is rehabbed, and you can also get title insurance.
Many websites are offering paid foreclosure listings. It is hard to differentiate between legitimate listings without spending some money.
I have found that RealtyTrac offers the best foreclosure listings. You’ll have to pay a subscription fee, but it is worth the money.
Another great, but FREE service is Bank Foreclosure Sales.
These foreclosure listings don’t necessarily provide information about the REO properties. The best way is to work with an REO agent or to find information on the bank website. However, these foreclosure listings can provide information about any home. This information will help you when making an offer.