Buying bank owned properties
The buss these days is all about Foreclosures and Short Sales, and there is a lot of interest in buying bank owned properties.  And rightfully so.  However, with so much information, some is going to be valuable, and some quite frankly is bad.  The internet is loaded with questionable information about the subject.   Often the information offered is for sale, with the promise that you can make a lot of money with little effort once you know “the secret formula”.  The fact is that there are no secrets, and to make money does require effort.  Let us help you sort the facts from the fiction.  The right decision can make you wealthy.  The wrong one can cost you dearly.

If you would like a copy of our free daily update of the top 10 Foreclosure Deals in Las Vegas, simply give us your email address and name, and we will include you in our "Top 10 Daily Hotlist" Blast.  If you have a particular area and/or price range that you are interested in let us know, and we will customize a "Top 10 Daily Hotlist" Blast just for you.  There is no obligation, but we promise prompt, courteous, and confidential service.

What’s an REO?
REO is an internal Bank term.  It stands for “Real Estate Owned”.  These are properties that have gone through foreclosure and are now owned by the bank or mortgage company.  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 accumulated 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 100% “as is”.  That could include existing liens and even current occupants that need to be evicted.  A REO, by contrast, is a much “cleaner” and attractive transaction.  The REO property did not find a buyer during foreclosure auction.  The bank now owns it.  The bank will see to the removal of tax liens, evict occupants if needed and generally prepare for the issuance of a title insurance policy to the buyer at closing.  Do be aware that REO’s may be exempt from normal disclosure requirements.  In Nevada, for example, banks are exempt from giving a Real Property Disclosure Statement, a document that normally requires sellers to tell you about any defects they are aware of.  This need not, and should not scare you off.  You may still be able to reserve the right to obtain a property inspection from a licensed inspector.

Is it a bargain?
It’s commonly assumed that any REO must be a bargain and an opportunity for easy money.  This simply isn’t true.  You have to be very careful about buying a REO if your intent is to make money off of it.  While it’s true that the bank is typically anxious to sell it quickly, they are also strongly motivated to get as much as they can for it.  When considering the value of a REO, you need to look closely at comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale.  The bargains with money making potential exist, and many people do very well buying foreclosures.  But there are also many REO’s that are not good buys and not likely to turn a profit.   We are there to help you with that evaluation, and help you navigate the potential mine fields.

Ready to make an offer?
Most banks have a REO department that you’ll work with in buying a 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 what they know if anything about the condition of the property and what their process is for receiving 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 hidden damage and terminate the offer if you find it.  While there are areas that can trip you up and turn a good deal into a bad one, we are there to help provide some of the protections necessary to help you feel confident about your investment.

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.  Then it will be up to you to decide whether to accept their counter, or offer a counter to the counter offer.  Realize, you’ll be dealing with a process that probably involves multiple people at the bank, and they don’t work evenings or weekends.  It’s not unusual for the process of offers and counter offers to take days or even weeks.  When dealing with Foreclosure and Short Sale negotiations, patience is truly is a virtue.

Again, if you would like a free daily update of our top 10 Foreclosure Deals in Las Vegas, simply give us your email address and name, and we will include you in our "Top 10 Daily Hotlist" Blast.  If you have a particular area and/or price range that you are interested in let us know, and we will customize a "Top 10 Daily Hotlist" Blast just for you.