Buying REO property or a foreclosure in Yuba City?


	Just as with any home purchase, your wisest move is to hire a professional real estate agent. For more information, you can contact me through my site or e-mail me. I'm glad to address any questions you have regarding real estate foreclosures.

What's an REO?

"REO" means Real Estate Owned. These are homes which have completed the foreclosure process that the bank or mortgage company now possesses. This differs from real estate up for foreclosure auction. Keller Williams Realty has experience to share with foreclosures and bank owned properties in Yuba City, California

Keller Williams Realty has experience to share with foreclosures and bank owned properties in Yuba City, California

If you buy 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 willing to pay with cash in hand. Finally, you'll get the property entirely as is. That could involve standing liens and even current occupants that need to be put out.

A bank-owned property, on the other hand, is a more tidy and attractive deal. The REO property was unable to find a buyer during foreclosure auction. The lender now owns it. The bank will see 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 standard disclosure requirements. For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that normally requires sellers to reveal any defects they are knowledgeable of. By hiring Keller Williams Realty, you can rest assured knowing all parties are fulfilling California state disclosure requirements.

Are REO properties a bargain in Sutter County?

It's sometimes presumed that any foreclosure must be a bargain and a chance for guaranteed profit. This isn't necessarily true. You have to be prudent about buying a REO if your intent is to make money off of it. While it's true that the bank is typically eager to sell it fast, they are also motivated to get as much as they can for it.

Keller Williams Realty has experience to share with foreclosures and bank owned properties in Yuba City, California

Look carefully at the listing and sales prices of comparable properties 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 not likely to turn a profit.

All set to make an offer?

Most mortgage companies have a department 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 often contract with 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 concerning the condition of the property and what their process is for receiving offers. Since banks usually 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 cancel the offer if you find it. If, as a buyer, you can provide documentation proving 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 holds for any real estate offer.)

After you've presented your offer, it's customary for the bank to counter offer. From there it will be your decision whether to accept their counter, or make another counter offer. Your deal might be settled 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. Keller Williams Realty is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no unnecessary delays.