Bank Owned Properties (REO's)

REO Properties
An REO (Real Estate Owned) is a property that goes back to Lender after an unsuccessful foreclosure auction.

With regard to REO properties, the Bank now owns the property and the mortgage loan no longer exists. The Bank will handle the eviction, if necessary, and may manage some of the repair process.

Selling REO's
Each Bank/Lender manages the REO process based on guidelines that are individually defined, but they all have similar goals. They want to get the best price possible and have often negotiated to achieve the highest possible price. However the market and expectations of Asset Managers may vary as inventories have increased and markets have slowed.

Property Condition
Banks always desire to sell a property in an "as is" condition. You may choose to hire professional inspection companies to determine the condition of the property. This is usually done to assist a potential bidder to better understand the highest price they are willing to offer based on the condition of the property.

The Auction Method Advantage
Banks are increasingly partnering with auction firms to offer multiple properties through the auction process. Depending on the property, location, condition, number of bidders etc., auctions can be an excellent method to purchase real estate.