Looking for REO property or a foreclosure in Montrose?
|Making an offer on a bank-owned property is not something to be taken casually. If you have questions about real estate in Montrose, Colorado, call me or send me an e-mail.|
What's an REO?"REO" or Real Estate Owned are properties which have been through foreclosure that the bank or mortgage company presently possesses. This differs from a property up for foreclosure auction.
If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees added during the foreclosure process. The buyer must also be willing to pay with cash in hand. And on top of all that, you'll accept the property completely as is. That possibly could include current liens and even current denizens that may require expulsion.
A bank-owned property, conversely, is a much cleaner and attractive transaction. The REO property didn't find a buyer during foreclosure auction. The bank now owns it. The lender will take care of 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.
Do be aware that REOs may be exempt from standard disclosure requirements. In California, for example, banks are not required to give a Transfer Disclosure Statement, a document that usually requires sellers to disclose any defects they are informed of. By hiring Eagles Wings Realty, you can rest assured knowing all parties are fulfilling Colorado state disclosure requirements.
Is REO property in Montrose a bargain?It's frequently presumed that any foreclosure must be a good deal and a chance for guaranteed profit. This isn't always true. You have to be prudent about buying a repossession if your intent is to profit from the sale. While it's true that the bank is typically anxious to offload it quickly, they are also motivated to minimize any losses.
Look carefully at the listing and sales prices of competing homes in the neighborhood when making an offer on 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. Still, there are also many REOs that are not good buys and not likely to turn a profit.
Ready to make an offer?Most lenders have staff dedicated to REO that you'll work with when buying REO property from them. Normally the REO department will use a listing agent to get their REO properties listed on the local MLS.
Prior to 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 accepting offers. Since banks typically sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for unknown damage and terminate the offer if you find it. If, as a buyer, you can provide documentation proving 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 real estate offer.)
Once you've made your offer, you can expect the bank to make a counter offer. From there it will be your choice whether to accept their counter, or offer a counter to the counter offer. Your transaction might be final in a single day, but that's rare. 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. Eagles Wings Realty is accustomed to these situations and will work to ensure there are no unnecessary delays.