Interested in REO property or a foreclosure in Temecula?
Smart consumers will turn to a seasoned pro when considering the purchase of a foreclosed property.
What is an REO?
"REO" or Real Estate Owned are homes which have gone through foreclosure that the bank or mortgage company now possesses. This is unlike a property up for foreclosure auction.
When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. The buyer must also be able to pay with cash in hand. Finally, you'll receive the property entirely as is. That possibly may comprise of standing liens and even current denizens that may require removal.
A bank-owned property, on the contrary, is a much neater and attractive proposition. The REO property was unable to find a buyer during foreclosure auction. The bank now owns it. The lender will see to the elimination of tax liens, evict occupants if needed and generally arrange 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 North Carolina, it is optional for foreclosures to have a Property Disclosure Statement, a document that typically requires sellers to reveal any defects of which they are informed. By hiring Sellstate Professional Real Estate DRE#01524667, you can rest assured knowing all parties are fulfilling California state disclosure requirements.
Is REO property in Temecula a bargain?
It's commonly assumed that any REO must be a steal and a chance for guaranteed profit. This frequently isn't true. You have to be prudent about buying a REO if your intent is make money. Even though the bank is typically eager to sell it quickly, they are also motivated to minimize any losses.
Look carefully at the listing and sales prices of comparable homes 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 flipping foreclosures. However there are also many REOs that are not good buys and may not be money makers.
Time to make an offer?
Most lenders have staff dedicated to REO that you'll work with while buying REO property from them. Typically the REO department will use a listing agent to get their REO properties listed on the local MLS.
Before 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 what they know regarding the condition of the property and what their process is for taking offers. Since banks typically sell REO properties "as is", you may want to include an inspection contingency in your offer that gives you time to check for unseen damage and withdraw the offer if you find it. As with making any offer on real estate, providing documentation proving your ability to secure financing 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 make a counter offer. At this point it will be up to you to decide whether to accept their counter, or offer a counter to the counter offer. Your deal might be final in a single day, but that's rare. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer. Sellstate Professional Real Estate DRE#01524667 is accustomed to these situations and will work to ensure there are no undue delays.
41540 Winchester Rd, Ste. A Temecula, CA 92590 Phone: Fax:
Look carefully at the listing and sales prices of comparable homes 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 flipping foreclosures. However there are also many REOs that are not good buys and may not be money makers.
