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Purchasing REO property or a foreclosure in Goldsboro?
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Foreclosed upon and bank owned property purchases require the assistance of an experience professional. For more information, just contact me through my site or e-mail me. I'm happy to answer any questions you have regarding real estate foreclosures. |
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What's an REO?"REO" is Real Estate Owned. These are properties which have been foreclosed upon and are presently possessed by the bank or mortgage company. 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 added during the foreclosure process. The buyer must also be prepared to pay with cash in hand. Finally, you'll accept the property 100% as is. That might include current liens and even current residents that may require expulsion.
A bank-owned property, on the contrary, is a much cleaner and attractive option. The REO property did not find a buyer during foreclosure auction. Now the lender owns it. The bank will see to 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.
Note that REOs may be exempt from standard disclosure requirements. For instance, in California, banks are exempt from giving a Transfer Disclosure Statement, a document that typically requires sellers to make known any defects they are knowledgeable of. By hiring Jane Bartlett, Realtor, you can rest assured knowing all parties are fulfilling North Carolina state disclosure requirements.
Am I guaranteed a low price when investing in an REO property in Goldsboro?It's occasionally believed that any REO must be a bargain and an opportunity for easy money. This isn't necessarily true. You have to be prudent about buying a REO if your intent is to make money off of it. Even though the bank is often eager to sell it fast, they are also motivated to minimize any losses.
 Look carefully at the listing and sales prices of comparable homes in the neighborhood when making an offer on an REO. And factor in any repairs or remodeling necessary to prepare the house for resale or moving in. It is possible to find REOs with money-making potential, and many people do very well flipping foreclosures. But there are also many REOs that are not good buys and may lose money.
Ready to make an offer?Most mortgage companies have staff dedicated to REO that you'll work with while 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 learn as much as you can about their knowledge about the condition of the property and what their process is for receiving offers. Since banks most commonly 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 withdraw the offer if you find it. As with making any offer on real estate, you'll make your offer more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.
After you've made your offer, you can expect the bank to make a counter offer. From there it will be your choice whether to accept their counter, or offer a counter to the counter offer. Your deal could be final in a single 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.
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