Without a doubt the number of REO’s on the market are going to increase through 2013 according to John Prior who writes for MarketWire, a premier site for financial news. Ideally banks would rent back to underwater homeowners who can no longer afford their payment thereby improving the flow of dispossessed homeowners. The home affordable program set up by Wiel Brien has exactly that idea only rents don’t match prices in the Bay area and holding on to a asset which is losing money is not an ideal solution for investors.
Buying an REO (bank owned property) may be a bargain or a problem. REO’s are sometimes in good condition and other times are remodel nightmares. Each asset holder and REO agent comes with their own lack of interest in responding to property inquiries and they may hold 40 or 50 properties making it impossible to know the condition of the property. The paperwork required to even get an offer reviewed can be so cumbersome that being the early bird and offering early is no advantage. Incomplete submissions may be ignored regardless of merit. Furthermore since the asset holder did not live in the property, they have fewer disclosure requirements making the adage “buyer beware” a reality that only an experienced real estate agent can take on. In order to negotiate a successful REO purchase you still need to understand value and more than ever need to have a good real estate agent. If you want more tips on how to navigate REO purchases contact Sandy Kay…
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