Purchasing REO property or a foreclosure in Aurora?


	Foreclosed upon and bank owned property purchases require the assistance of an experience professional. Should you have any questions regarding real estate in Aurora, Colorado, call me or send me an e-mail.

What is an REO?

"REO" or Real Estate Owned are homes which have been foreclosed upon that the bank or mortgage company currently possesses. This is not the same as real estate up for foreclosure auction. The Way Home Realty has experience to share with foreclosures and bank owned properties in Aurora, Colorado

The Way Home Realty has experience to share with foreclosures and bank owned properties in Aurora, Colorado

If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accrued during the foreclosure process. You must also be ready to pay with cash in hand. Finally, you'll get the property entirely as is. That could comprise of current liens and even current occupants that may require expulsion.

A bank-owned property, on the contrary, is a much neater and attractive proposition. The REO property did not find a buyer during foreclosure auction. The lender now owns it. The bank will take care of 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.

Do be aware that REOs may be exempt from typical disclosure requirements. For instance, in California, banks do not have to give a Transfer Disclosure Statement, a document that ordinarily requires sellers to disclose any defects they are aware of. By hiring The Way Home Realty, you can rest assured knowing all parties are fulfilling Colorado state disclosure requirements.

Are REO properties a bargain in Arapahoe County?

It is frequently thought that any REO must be a steal and a chance for guaranteed profit. This isn't always the case. You have to be prudent about buying a repossession if your intent is make a profit. Even though the bank is usually anxious to offload it quickly, they are also looking to minimize any losses.

The Way Home Realty has experience to share with foreclosures and bank owned properties in Aurora, Colorado

Look carefully 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. The bargains with money making potential exist, and many people do very well buying and selling foreclosures. But there are also many REOs that are not good buys and not likely to turn a profit.

Time to make an offer?

Most lenders have staff dedicated to REO that you'll work with in buying REO property from them. Usually 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 getting offers. Since banks almost always 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 hidden damage and withdraw the offer if you find it. As with making any offer on real estate, providing documentation of your ability to secure financing may make your offer more attractive, such as a pre-approval letter from a lender.

Once you've made your offer, you can expect the bank to make a counter offer. Then it will be your decision whether to accept their counter, or offer a counter to the counter offer. Your transaction might be settled 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. The Way Home Realty is accustomed to these situations and will work to ensure there are no undue delays.