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How to buy an REO, mortgage or bank owned property?

How to buy an REO, mortgage or bank owned property?

How to buy an REO, mortgage or bank owned property?

REO simply means real estate. Many people use the terms REO, Bank Owned and Foreclosure as one. I would like to clarify and illustrate the REO buying process. When a borrower defaults on a mortgage, the current lender takes legal action to take possession of the delinquent property. This is usually done through foreclosure through the governing court system. A borrower can also voluntarily return the property to a lender and this is known as a deed in lieu of foreclosure. Either by court action or by voluntary release, once the property has been recovered from the defaulting borrower, it becomes the property of the foreclosed lender. Then it is a foreclosed REO property, owned by the bank.

To buy an REO, a buyer can start on the Internet. The best place to find bank properties is to visit the common banks website. Try a Google search for Wells Fargo REO, Bank of America REO or HSBC REO properties. You will usually find a list of searchable properties. You will most likely be directed to an REO agent. Most lenders employ a competent real estate agent to assist them in marketing and selling their properties. Your best ally if you’re looking to buy a banked home is to find the top REO listing agents in your area. The agent will help you find the right home for your needs.

The first step in finding any home is to get pre-qualified through a mortgage lender. If you are a cash buyer, you can skip this step, but be prepared to provide proof of funds to buy a bank home. Once you’re qualified, your agent can send you a list of homes. Go through it and narrow your selection down to a few properties. The REO agent will show, report and compare selected properties. Once you decide on a property and make an offer, the process has just begun.

There are a few things that are different when you buy an REO:

Seller’s addendum

Closing costs

Diets

Utilities and Inspection

Negotiations

#buy #REO #mortgage #bank #owned #property

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