Making an offer on REO property or a foreclosure in CORAL SPRINGS?
Just as with any property purchase, your smartest move is to hire a professional real estate agent.
If you have any questions about real estate in CORAL SPRINGS, Florida, call me or send me an e-mail.
What's an REO?
"REO" or Real Estate Owned are homes which have been foreclosed upon that the bank or mortgage company presently possesses. This is not the same as 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 accrued during the foreclosure process. You must also be prepared to pay with cash in hand. And on top of all that, you'll receive the property entirely as is. That might include prevailing liens and even current tenants that may require expulsion.
A bank-owned property, by contrast, is a much neater and attractive transaction. The REO property was unable to find a buyer during foreclosure auction. The lender now owns it. The lender will attend to the removal of tax liens, evict occupants if needed and generally organize 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 disclose any defects they are aware of.
By hiring THE ASLAN GROUP REALTY & INVESTMENT, INC., you can rest assured knowing all parties are fulfilling Florida state disclosure requirements.
Am I assured a low price when buying a bank owned property in CORAL SPRINGS?
It's sometimes assumed that any foreclosure must be a steal and an opportunity for guaranteed profit. This isn't necessarily the case. You have to be prudent about buying a REO if your intent is to make money off of it. Even though the bank is usually eager to offload it soon, they are also motivated to get as much as they can for it.
Look carefully at the listing and sales prices of similar properties 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.
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 not be money makers.
Ready to make an offer?
Most lenders have a department dedicated to REO that you'll work with when buying REO property from them. To get their properties advertised on the local MLS, the lender will frequently contract with a listing agent.
Before making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about what they know about the condition of the property and what their process is for getting offers. Since banks almost always sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for unknown damage and cancel the offer if you find it.
If, as a buyer, you can provide documentation demonstrating your ability to secure financing, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This is generally true for any type of real estate offer.)
Once you've made your offer, it's customary for the bank to make a counter offer. From there it will be your choice whether to accept their counter, or submit another counter offer.
Your transaction might be final in one day, but that's usually not the case. 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.
Look carefully at the listing and sales prices of similar properties 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.
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 not be money makers.
