Special offer

Protecting your client in an REO transaction

By
Title Insurance with Key Title Corporation 63078

In almost every REO deal the bank will counter offer with their own addendum which will contain significant changes to your offer.  Some of the terms you will see in the counter-offer will include such items as:

  • In the event of a conflict the bank's terms will prevail.  What does that mean, well it means that the original contract is basically uselss and the seller's addendum will represent the entire agreement between the parties
  • The bank will deliver a "Special Warranty Deed.  Meaning, the bank only has to clear title issues for the time period in which it was the owner of the property.  Any title issues that existed prior to the bank's ownership become the problem of the new owner and their title insurer.
  • You MUST use the the bank's title agent.  If you go for this you are getting only what the bank is willing to give, which is not marketable title, but merely insurable title.  You are NOT REQUIRED to use the bank's title agent and you are urged NOT to use the bank's title agent UNLESS you know for a certain fact that the title agent has completed a full 60 year title examination and has cleared all prior title issues. It is definately in your best interest to use a neutral title agent to insure to yourself that you are not buying into a problem that you will need to deal with in the future. 

Protect your client.  Call on us to complete your REO transaction.  With more than 50 years combined experience, most of it in transferring REO properties, we will provide your buyer the assurances of good and marketable title that the seller's title agent is not in a position to offer.

 

CHARLENE PERRY

The Preferred Title Group, Inc.

3605 E. Joppa Road

Baltimore,MD 21234

410-663-7444

Posted by

Charlene Perry
Key Title, Inc. 
35 Fulford Avenue
Bel Air, MD 20104
410-803-4800

Anonymous
Tom Robinson

If I were buying a property and two properties were about the same price and the lower priced one was an REO, I would probably buy the regular sale property because of all the issues with REOs (and for that matter) short sales. I try to make buyers aware of some of the issues that the general public is not familiar with.

Dec 07, 2009 07:41 AM
#1
Anonymous
Charlene Perry

Tom,

Thank you for your response. Yours is a typical response and that is exactly the response I would expect from realtors and consumers who have been through "bad" REO transactions.  REO transactions can actually go quite smoothly if you use the services of a title agent who is well versed in transferring REO properties and who has formed a good network of contacts with asset managers, realtors and foreclosure attorneys. 

Unfortunately in today's climate,with the the sellers forcing (or trying to force) the buyers in REO transactions to use the seller's title agent, you will not have a smooth and timely closing. It is really important that the buyer insist that they be allowed to retain the services of their own title agent.  In this way the buyer is assured that someone else is looking out for the best interest of the buyer, that a full and complete title examination is being conducted, and that there is someone other than you forcing the time issues that are so critical in REO transactions.

Please call on me if I an answer any questions for you or your clients about REO transacations in Maryland. 

Charlene Perry

Dec 07, 2009 09:08 AM
#2
Letitia Stevenson
BHHS Fox & Roach | www.DelawareValleyRE.com - Greenville, DE
Listing Agent DE/PA/MD, Digital Marketer & Coach

Charlene, Welcome to Active Rain! Active Rain is a great place to share your knowledge, expertise and thoughts, as well as network and learn so much from the vast pool of talent already onboard.

Welcome Aboard and Much Success in 2010!

Jan 26, 2010 09:30 AM