Interested in REO property or a foreclosure in Rowland Heights?
|Smart consumers will turn to a seasoned pro when considering a foreclosed property. If you have questions regarding real estate in Rowland Heights, California, call me or send me an e-mail.|
What's an REO?"REO" stands for Real Estate Owned. These are properties which have completed the foreclosure process and are presently held by the bank or mortgage company. This is not the same as 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 accrued during the foreclosure process. You must also be ready to pay with cash in hand. And on top of all that, you'll get the property totally as is. That possibly could consist of prevailing liens and even current occupants that need to be thrown out.
A bank-owned property, by contrast, is a more tidy and attractive transaction. The REO property was unable to find a buyer during foreclosure auction. Now the lender owns it. The lender will handle the removal of tax liens, evict occupants if needed and generally plan for the issuance of a title insurance policy to the buyer at closing.
Take notice that REOs may be exempt from typical disclosure requirements. For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that typically requires sellers to tell you about any defects they are aware of. By hiring James J. Chou, Re/Max 2000 Realty, you can rest assured knowing all parties are fulfilling California state disclosure requirements.
Is REO property in Rowland Heights a bargain?It is commonly believed that any foreclosure must be a steal and a possibility for guaranteed profit. This isn't necessarily the case. You have to be cautious about buying a repossession if your intent is make a profit. While it's true that the bank is typically eager to offload it soon, they are also motivated to minimize any losses.
Look carefully at the listing and sales prices of comparable properties in the neighborhood when considering the purchase of 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 and selling foreclosures. However there are also many REOs that are not good buys and may lose money.
All set to make an offer?Most lenders have a department dedicated to REO that you'll work with in buying REO property from them. To get their properties advertised on the local MLS, the lender will usually hire 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 their knowledge regarding the condition of the property and what their process is for getting offers. Since banks typically sell REO properties "as is", it's often prudent to include an inspection contingency in your offer that gives you time to check for unseen damage and cancel the offer if you find it. As with making any offer on real estate, providing documentation proving your ability to pay may make your offer more attractive, such as a pre-approval letter from a lender.
After you've made your offer, it's customary for the bank to respond with a counter offer. Then it will be your decision whether to accept their counter, or make another counter offer. Your deal might be final in one day, but that's rare. Since offers and counter offers usually give the other party a day or longer to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer. James J. Chou, Re/Max 2000 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.