Purchasing REO property or a foreclosure in Roseville?


	Savvy consumers will turn to a seasoned pro when considering the purchase of a foreclosed property. If you have any questions about real estate in Roseville, California, call me or send me an e-mail.

What is an REO?

"REO" or Real Estate Owned are properties which have been foreclosed upon that the bank or mortgage company now holds. This is different than a property up for foreclosure auction. Prudential California Realty has experience to share with foreclosures and bank owned properties in Roseville, California

Prudential California Realty has experience to share with foreclosures and bank owned properties in Roseville, California

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. You must also be prepared to pay with cash in hand. And on top of all that, you'll accept the property completely as is. That could comprise of prevailing liens and even current occupants that need to be expelled.

A bank-owned property, conversely, is a much neater and attractive transaction. The REO property was unable to find a buyer during foreclosure auction. Now the lender owns it. The lender will handle the removal of tax liens, evict occupants if needed and generally arrange for the issuance of a title insurance policy to the buyer at closing.

Take notice that REOs may be exempt from normal disclosure requirements. For instance, in California, banks do not have to give a Transfer Disclosure Statement, a document that typically requires sellers to tell you about any defects of which they are knowledgeable. By hiring Prudential California Realty, you can rest assured knowing all parties are fulfilling California state disclosure requirements.

Are REO properties a bargain in Roseville?

It is sometimes presumed that any REO must be a steal and a chance for guaranteed profit. This isn't necessarily the case. You have to be cautious about buying a repossession if your intent is make money. While it's true that the bank is typically anxious to sell it fast, they are also motivated to get as much as they can for it.

Prudential California Realty has experience to share with foreclosures and bank owned properties in Roseville, California

When pondering what to pay for REO property, carefully analyze comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. It is possible to find REOs with money-making potential, and many people do very well buying and selling foreclosures. However 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 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 discover as much as you can about their knowledge regarding the condition of the property and what their process is for accepting 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 unseen damage and cancel 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 goes for any type of real estate offer.)

Once you've submitted your offer, you can expect the bank to respond with a counter offer. At this point it will be up to you to decide whether to accept their counter, or offer a counter to the counter offer. Be aware, 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 not uncommon for the process of offers and counter offers to take days or even weeks.