Interested in REO property or a foreclosure in Staunton?
|Foreclosed upon and bank owned property purchases require the assistance of an experience professional. Should you have any questions about real estate in Staunton, Virginia, call me or send me an e-mail.|
What is an REO?"REO" stands for Real Estate Owned. These are houses which have gone through foreclosure that the bank or mortgage company currently holds. This is unlike 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 willing to pay with cash in hand. Finally, you'll accept the property 100% as is. That possibly will involve standing liens and even current occupants that may require eviction.
A bank-owned property, by contrast, is a much cleaner and attractive deal. The REO property was unable to find a buyer during foreclosure auction. Now the bank owns it. The lender will see to the removal of tax liens, evict occupants if needed and generally plan 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 instance, in California, banks do not have to give a Transfer Disclosure Statement, a document that normally requires sellers to disclose any defects of which they are knowledgeable. By hiring RE/MAX Advantage, you can rest assured knowing all parties are fulfilling Virginia state disclosure requirements.
Am I guaranteed a bargain when purchasing a bank owned property in Staunton?It is occasionally presumed that any foreclosure must be a good deal and a chance for easy money. This often isn't true. You have to be prudent about buying a REO if your intent is make a profit. While it's true that the bank is usually eager to sell it fast, they are also motivated to minimize any losses.
Look closely at the listing and sales prices of similar homes 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. It is possible to find REOs with money-making potential, and many people do very well buying and selling foreclosures. But there are also many REOs that are not good buys and may lose money.
Ready to make an offer?Most banks have staff dedicated to REO that you'll work with while buying REO property from them. Commonly 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 learn as much as you can about their knowledge concerning the condition of the property and what their process is for getting offers. Since banks usually sell REO properties "as is", it may be in your best interest to include an inspection contingency in your offer that gives you time to check for unknown damage and retract the offer if you find it. If, as a buyer, you can provide documentation showing your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This holds for any type of real estate offer.)
Once you've submitted 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 settled in a single day, but that's usually not the case. 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. RE/MAX Advantage is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no undue delays.