Interested in REO property or a foreclosure in South Central Minnesota?
Foreclosed upon and bank owned property purchases require the assistance of an experience professional.
For more information, simply 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" or Real Estate Owned are houses which have been through foreclosure and are presently possessed by the bank or mortgage company. This differs from real estate 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. You must also be willing to pay with cash in hand. Finally, you'll get the property entirely as is. That possibly may comprise of standing liens and even current residents that need to be evicted.
A bank-owned property, on the other hand, is a much neater and attractive deal. The REO property did not find a buyer during foreclosure auction. Now the lender owns it. The lender will handle the removal of tax liens, evict occupants if needed and generally arrange for the issuance of a title insurance policy to the buyer at closing.
Note that REOs may be exempt from typical disclosure requirements.
For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement,
a document that normally requires sellers to tell you about any defects they are knowledgeable of.
By hiring D & L Real Estate, you can rest assured knowing all parties are fulfilling Minnesota state disclosure requirements.
Am I guaranteed a bargain when buying a bank owned property in South Central Minnesota?
It's commonly assumed that any REO must be a bargain and an opportunity for easy money. This often isn't true. You have to be prudent about buying a repossession if your intent is to make money. Even though the bank is typically eager to offload it quickly, they are also looking to get as much as they can for it.
Look carefully at the listing and sales prices of comparable properties in the neighborhood when making an offer on an REO. And factor in any repairs or upgrades 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 buying foreclosures. Still, there are also many REOs that are not good buys and may not be money makers.
Ready to make an offer?
Most banks have a department 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 find out as much as you can about their knowledge about the condition of the property and what their process is for receiving offers. Since banks usually sell REO properties "as is", you may want to include an inspection contingency in your offer that gives you time to check for hidden damage and terminate the offer if you find it.
As with making any offer on real estate, your offer may be more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.
Once you've made 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 final in one 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. D & L Real Estate is used to working around the schedules of this type of seller and will do everything possible to ensure there are no unnecessary delays.