Getting hold of bank REO homes involves a different procedure from acquiring residential properties through auction or through direct purchase from the owner or a real estate agent.
There are several significant steps that should be known to buyers who prefer to purchase REO homes.
Locating Properties To find bank owned properties, the best option for buyers is to subscribe to online foreclosure listings.
This is way more convenient than seeking out local Multiple Listing Services (MLS).
For one, a property listed in one MLS might not be listed on another.
These Services do not share information so there is no way buyers will be able to cover all their options by using just one MLS.
Aside from being more comprehensive, online foreclosure listings are also easier to access.
Buyers can log in anytime or from anywhere and search for the properties that meet their criteria.
From these listings, they can create a short list of the properties they would want to consider.
Buyer vs Bank Responsibilities When it comes to making repairs on bank REO homes, buyers should not expect the lender or bank that owns the property to take care of them.
Bank owned houses are often sold in an "as is" condition; meaning, the buyer will have to take it at its present condition, with the disrepairs, damages and all.
If a buyer is planning to finance the purchase through a government loan, it might prove to be difficult.
FHA loans are not provided to homes that are considered uninhabitable nor have too many repairs required.
Making an Offer Before buyers can start negotiations, they need to prepare several documents first that would be submitted to the bank that owns the property.
These documents should be prepared before looking for a property to purchase, not during the search.
No bank will entertain an offer without these papers.
These documents include funds verification documents, credit score reports and a pre-approval document.
The first one will prove that the buyer actually have the funds for the deposit, while the second is to check the capability of the buyer to pay the full price.
A check for the deposit is also necessary.
Buying bank REO homes entails several steps and a lot of preparation.
If a buyer knows what to do and prepares for the transaction carefully, all the efforts and troubles will be worth it.