REO vs. Bank Owned Property
What is an REO/ Bank Owned Property
REO’s (Real Estate Owned) are also known as Bank Owned Property; these are one in the same. An REO is a property that goes back to the bank after an unsuccessful foreclosure auction. The bank now owns the property and the mortgage loan no longer exists.
Selling an REO/ Bank Owned Property
Time is of the essence for the bank to sell the home and “get it off their books”. They will be looking to get the highest price possible in the shortest period of time. To achieve their objective, banks hire a REO Real Estate broker to handle all aspects as it relates to selling the home (details can be found here).
Buying an REO/ Bank Owned Property
Before making an offer, the selling agent will contact the listing agent to ask the following:
- Are there any inspection reports?
- What work has the bank agreed to?
- Is there a special “as is” form?
- How long does it take the bank to accept an offer?
- How does your agent deliver the offer?
Offers are usually FAXED to the bank. The listing agent needs your originals. There is no formal presentation. Keep in mind: nothing happens evenings and weekends (banks are closed)
Since there is no face-to-face presentation to the bank, provide the listing agent with a pre-qualification or better yet, a pre-approval letter and buyer biography. Make your offer easy to accept.
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