REO FAQ


Pride in Ownership

by Lance Kettler

If you would like to own your home but feel that the market has priced you out, I have good news for you.  There is a whole other market out there with different rules and different price tags.  And the prices are significantly lower.  What market am I talking about?  The REO market.  REO stands for Real Estate Owned.  These properties have already been foreclosed upon and are sitting empty waiting for a qualified buyer.  In some cases these properties are being sold for as much as 30% below the regular market value.  

I can hear you saying “What’s wrong with these REO homes?” In some cases nothing except a little neglect from sitting empty.  In some cases there are extensive repairs to be made.  There are a wide range of properties available in the San Fernando Valley, in almost every neighborhood. 

If you have been longing to own a home I urge you to investigate this market by giving our office a call.  We will be happy to show you what is available in your price range.  Don’t miss out on this opportunity because you think it is too good to be true.  This opportunity is real!

 

 

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REO Neighborhood 911

by Lance Kettler

As distraught home owners are being devastated by the reality of their ARM loans resetting, more and more homes are slipping into foreclosure.  Over half of the homes that are foreclosed upon are bypassed at auction and are reverting back to bank ownership.  These properties are known as REO (Real Estate Owned). As the supply of these lender owned properties grows more and more neighborhoods are finding themselves with a real problem.

When a house becomes an REO it will sit empty until a buyer makes an offer and a deal can be struck.  In times past this was an inconvenience, but with the glut of REOs on the market it has become a neighborhood problem.  With so many properties to look after banks do not have the time to maintain the homes and do necessary upkeep.  Lawns are becoming unkempt, swimming pools are growing mold and attracting mosquitoes.  In some cases vandalism is becoming prevalent.  The problem is big and growing bigger.

There is a silver lining, however.  We are seeing that banks, overwhelmed as they are by the sheer weight of maintaining these properties are willing to make deals that are attractive to qualified buyers.  Offers that even a few months ago were scoffed at are now being entertained and even accepted. If you are interested in buying a home or investing in real estate, there is no moment like the present.  Purchase REO and get the deal of the century while helping a neighborhood return to normalcy.

 

REO FAQ Part II
By Lance Kettler

Interested in more REO frequently asked questions? Here they are!

Is it true that you need a realtor to find an REO?

Yes.  But it shouldn’t be just any realtor.  If you are serious about purchasing REO property and saving tens if not hundreds of thousands of dollars make sure that you have an experienced REO real estate professional.  Banks and lenders are extremely protective of their REO property lists; generally they do not advertise that the properties are REO. They prefer to work with a select few professionals who have proven themselves to be proficient in the REO process.  By not working with a top notch recognized REO specialist you could be preventing yourself from seeing all of the properties that are available

Isn’t buying REO risky because you never really know what you are getting?

No.  In fact buying REO property is very similar to purchasing typical real estate.  You get to view the property before making an offer and after making an offer you are able to have the property inspected in the same way you would with typical real estate. 

Is it true that you can save a substantial amount when purchasing an REO property?

Yes. Right now we are seeing people purchase REOs between 10-30% below market value.  That’s a substantial savings!

If you have questions about purchasing REO property please type your questions below and I will be happy to answer them.  If you are ready to look at what the REO market has to offer please give my office a call and we’ll be happy to help you.

REO FAQ

by Lance Kettler

Do you have questions about purchasing REO property?  This is a great forum to ask your questions and get answers.  In the meantime I thought I would answer some of the more common questions I get about purchasing REO property.

Aren’t REO properties horrible burned out buildings that they couldn’t even sell at auction?

No.  It is a common misconception that all REO properties are in horrible inhabitable shape.  In today’s market it is estimated that more than half of all properties in foreclosure will become REO property.  Some of those properties will be in rough shape, some will have moderate damage and some will be in relatively great shape with minimal issues similar to typical homes on the market.

If the property does need repairs, doesn’t it just become a cash upfront nightmare for the buyer?

No.  In today’s market banks and lenders are motivated to sell their REO properties.  In some cases they are offering allowances and incentives to take care of the repairs.   In other cases the banks are completing the repairs before offering the home in order to move the home quickly. Additionally, if you qualify, there are some loans available that allow a purchaser of an REO to wrap the costs of the repairs into the home mortgage.

For more REO FAQ check back for the next installment, or subscribe to the blog by pressing the RSS button below.