Making an offer on REO property or a foreclosure in Fort Wayne?


	Foreclosed upon and bank owned property purchases require the assistance of an experience professional. If you have any questions about real estate in Fort Wayne, Indiana, call me or send me an e-mail.

What is an REO?

"REO" stands for Real Estate Owned. These are homes which have been foreclosed upon that the bank or mortgage company now owns. This is different than real estate up for foreclosure auction. North Eastern Group Realty has experience to share with foreclosures and bank owned properties in Fort Wayne, Indiana

North Eastern Group Realty has experience to share with foreclosures and bank owned properties in Fort Wayne, Indiana

When buying 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. The buyer must also be ready to pay with cash in hand. And on top of all that, you'll accept the property 100% as is. That may include existing liens and even current occupants that may require expulsion.

A bank-owned property, conversely, is a much cleaner and attractive deal. The REO property did not find a buyer during foreclosure auction. The bank now owns it. The bank will handle the elimination of tax liens, evict occupants if needed and generally organize for the issuance of a title insurance policy to the buyer at closing.

Take notice that REOs may be exempt from typical disclosure requirements. In California, for example, banks are not required to give a Transfer Disclosure Statement, a document that typically requires sellers to disclose any defects of which they are aware. By hiring North Eastern Group Realty, you can rest assured knowing all parties are fulfilling Indiana state disclosure requirements.

Am I assured a bargain when investing in an REO property in Fort Wayne?

It is commonly thought that any REO must be a steal and a chance for guaranteed profit. This frequently isn't true. You have to be cautious about buying a repossession if your intent is profit from the sale. While it's true that the bank is usually anxious to offload it soon, they are also looking to minimize any losses.

North Eastern Group Realty has experience to share with foreclosures and bank owned properties in Fort Wayne, Indiana

Look closely at the listing and sales prices of competing properties in the neighborhood when making an offer on an REO. And factor in any repairs or remodeling 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.

Time to make an offer?

Most lenders have staff dedicated to REO that you'll work with while buying 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 their knowledge concerning the condition of the property and what their process is for taking offers. Since banks most commonly sell REO properties "as is", you may want to include an inspection contingency in your offer that gives you time to check for unseen damage and terminate the offer if you find it. As with making any offer on real estate, your offer may be more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.

After you've presented your offer, you can expect the bank to counter offer. From there it will be your choice whether to accept their counter, or submit another counter offer. Realize, you'll be dealing with a process that usually involves a group of people at the bank, and they don't work evenings or weekends. It's quite common for the process of offers and counter offers to take days or even weeks.