Now that the bank owns the property the mortgage loan no longer exists. The bank will handle any evictions and usually will make minor repairs. They will also negotiate with the IRS for removal of tax liens and pay off any homeowner's association dues. Banks and lenders want to get the best price possible. A bank owned property may not be a bargain. Speak to you Real Estate Agent to find out what your home is worth compare to homes in the neighborhood. You may want to consider the cost of any renovations needed.
Once you make an offer on the home, banks will usually present a "counter-offer". It maybe at a higher price than you expected. You should plan to counter offer. Unless there are multiple offers at the same time, they will be submitted to the bank. The bank will now consider the offer with the highest bid and highest down payment. Your counter-offer will probably have to be reviewed and approved by several individuals and companies.
If you are going to get involved in foreclosures, then this is something that you really need to research carefully. You may get a bargain at the auction, but you could end up paying much more money because of everything owned or the amount of repairs needed to the home. If you take the time to look into the law and how it works, you maybe able to save yourself a whole lot of time, grief and money down the line.
buying a foreclosure
Buying Bank Owned PropertiesIn real estate there are many, many types of properties that you can buy. The majority of time people hire a real estate agent to help them buy a property that is listed on the MLS (Multiple Listing Service) of the area that they are looking for. While most people go through this route, there are others that are bargain hunting people, who look at houses that are either in foreclosure or REO (Real Estate Owned) or bank or Loan Company.
Buying Bank Owned PropertiesIn real estate there are many, many types of properties that you can buy. The majority of time people hire a real estate agent to help them buy a property that is listed on the MLS (Multiple Listing Service) of the area that they are looking for. While most people go through this route, there are others that are bargain hunting people, who look at houses that are either in foreclosure or REO (Real Estate Owned) or bank or Loan Company.
In real estate there are many, many types of properties that you can buy. The majority of time people hire a real estate agent to help them buy a property that is listed on the MLS (Multiple Listing Service) of the area that they are looking for. While most people go through this route, there are others that are bargain hunting people, who look at houses that are either in foreclosure or REO (Real Estate Owned) or bank or Loan Company.
A common misconception that people outside of the real estate industry make, believe that foreclosure and REO purchase is the same. Although they are similar, they are in fact different. To understand the difference between the two and how they vary from each other it is best to define what each is, and their respective merits.
The term Real Estate Owned (REO) is a property that goes back to the mortgage company after an unsuccessful foreclosure auction. This often happens as a result of the borrower defaulting on loan, the lender foreclosing on the property, and then the property now going through the Trustee Sale without the buyer. The reason most foreclosure auctions do not even sell is because, there wasn't enough equity in the property to satisfy the loan. This is usually how most homes end up in foreclosure.
The term Foreclosure is used when the property goes to a foreclosure auction or Trustee Sale is being held in order for the lender to try to move the property. Lenders are not interested in having their money tied up in real estate because they would rather have their money loaned out and being paid back with interest. Foreclosure sales begin with a minimum bid that includes the loan balance, accrued interest, attorney's fees and any costs associated with the process. In order to bid on a foreclosure at the auction you must have a cashier's check for the full amount of you bid. The properties condition is "as is " , which may include occupants still living in the home. There may also be liens against the property.
Buying a Bank owned Reo property 
Now that the bank owns the property the mortgage loan no longer exists. The bank will handle any evictions and usually will make minor repairs. They will also negotiate with the IRS for removal of tax liens and pay off any homeowner's association dues. Banks and lenders want to get the best price possible. A bank owned property may not be a bargain. Speak to you Real Estate Agent to find out what your home is worth compare to homes in the neighborhood. You may want to consider the cost of any renovations needed.
Once you make an offer on the home, banks will usually present a "counter-offer". It maybe at a higher price than you expected. You should plan to counter offer. Unless there are multiple offers at the same time, they will be submitted to the bank. The bank will now consider the offer with the highest bid and highest down payment. Your counter-offer will probably have to be reviewed and approved by several individuals and companies.
If you are going to get involved in foreclosures, then this is something that you really need to research carefully. You may get a bargain at the auction, but you could end up paying much more money because of everything owned or the amount of repairs needed to the home. If you take the time to look into the law and how it works, you maybe able to save yourself a whole lot of time, grief and money down the line.
Now that the bank owns the property the mortgage loan no longer exists. The bank will handle any evictions and usually will make minor repairs. They will also negotiate with the IRS for removal of tax liens and pay off any homeowner's association dues. Banks and lenders want to get the best price possible. A bank owned property may not be a bargain. Speak to you Real Estate Agent to find out what your home is worth compare to homes in the neighborhood. You may want to consider the cost of any renovations needed.
Once you make an offer on the home, banks will usually present a "counter-offer". It maybe at a higher price than you expected. You should plan to counter offer. Unless there are multiple offers at the same time, they will be submitted to the bank. The bank will now consider the offer with the highest bid and highest down payment. Your counter-offer will probably have to be reviewed and approved by several individuals and companies.
If you are going to get involved in foreclosures, then this is something that you really need to research carefully. You may get a bargain at the auction, but you could end up paying much more money because of everything owned or the amount of repairs needed to the home. If you take the time to look into the law and how it works, you maybe able to save yourself a whole lot of time, grief and money down the line.
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