 When dealing with REOs, you’re virtually assured that there are no liens or judgments clouding the title and all taxes are brought current.
The occupants have already been evicted.
The amount of cash needed to purchase an REO can be a little as 3% of the purchase price with FHA financing and as low as 10% with conventional loans. Furthermore, the initial deposit is typically $1,000.00 pending your inspection and a total of $5000.00 post inspection up until closing.
There is minimal risk as REOs are sold as is. The lender offers no guarantees as to the condition of the home. The risk is limited only to the condition of the house and that is remedied by your due diligence. Your offer is subject to a satisfactory inspection. On the inspection day all utilities will be made available for you and your inspector. After completing a thorough home inspection and a professional termite inspection, if you’re not comfortable with the condition of the house and do not want to proceed, your deposit is returned and the contact voided.
The seller may agree to pay for repairs if structural damage is discovered or the property has other major defects.
Most offers are in writing which is very similar to making an offer on a non-foreclosure property. In Florida we use a far-bar as is contract. (Contract)
The seller may provide financing terms that are extremely favorable for the buyer.
You are granted full access to the property for the purposes of previewing prior to making an offer just as you would with any non-foreclosure property.
There is the potential to purchase at 25% below fair market value.
You have the advantage of working with real estate professionals on both sides of the transaction, buyer’s agent and listing agent. Real estate agents must abide by a strict code of ethics and buying and selling property is their area of expertise. Also, real estate professionals have valuable information and insight regarding the local housing market.
Buying an REO property is easy and straightforward. Except for the price, you will not find it much different than buying a non-foreclosure house.
My expertise and professional insights are free to you the buyer. Contact me today or join my e-mail list.
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