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What is a Bank-owned (REO)?
If the lender takes ownership of the property, either through an agreement with the owner during pre-foreclosure or at the public auction, the lender will usually want to re-sell the property to recover the unpaid loan amount. The lender will then typically clear the title and perform needed maintenance and repair; however, the potential bargain for these REO homes is typically less than a pre-foreclosure or auction property. Bank foreclosures can become government foreclosures if the loan is backed by a government agency such as the Department of Housing and Urban Development (HUD) or the Department of Veterans Affairs (VA). In that case the government agency would be responsible for selling the property.
Benefits to buying REO’s
· If two loans were secured to the property (which is common these days), the second lender sometimes does not foreclose. If the second lender does not make up the back payments to the first lender and commence its own foreclosure proceedings, the second lender gets wiped out in the foreclosure. Many second mortgages comprise 20% or more of original market value.
· The bank does not want to sit on its inventory. Since it did not receive its minimum bid from an investor or home buyer during the foreclosure sale at the courthouse, the bank is likely to price that REO home for less, just to get rid of it.
Hiring FBG Investment Property Group
Unless you have direct experience negotiating with banks, you may receive better representation by hiring FBG Investment Property Group.
· FBG Investment Property Group has a fiduciary responsibility to protect your interests
· FBG Investment Property Group does not represent the seller
· FBG Investment Property Group services are paid by the bank
Hire a buyer's agent who has experience working with foreclosures. Hire FBG Investment Property Group to take care of your needs and to represent you. ALL FREE OF CHARGE!
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