Looking for REO property or a foreclosure in Pitt County?
What is an REO?
“REO” or Real Estate Owned are homes that have completed the foreclosure process and are presently possessed by the bank or mortgage company. This is unlike real estate up for foreclosure auction.
If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. The buyer must also be able to pay with cash in hand. To top everything off, you’ll receive the property entirely as-is. That possibly will comprise of existing liens and even current tenants that may require eviction.
A bank-owned property, on the other hand, is a more tidy and attractive proposition. The REO property didn’t find a buyer during foreclosure auction. The bank now owns it. The lender will handle the elimination 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 example, in Nevada, it is optional for foreclosures to have a Property Disclosure Statement, a document that ordinarily requires sellers to make known any defects they are knowledgeable of. By hiring HOME AT LAST Realty Solutions, you can rest assured knowing all parties are fulfilling North Carolina state disclosure requirements.
Are REO properties a bargain in Pitt County?
It is frequently thought that any REO must be a bargain and a chance for guaranteed profit. This isn’t always the case. You have to be cautious about buying an REO if your intent is to profit from the sale. While it’s true that the bank is often eager to offload it quickly, they are also motivated to get as much as they can for it.
Look carefully at the listing and sales prices of comparable properties in the neighborhood when considering the purchase of an REO. And factor in any repairs or remodeling necessary to prepare the house for resale or moving in. It is possible to find REOs with money-making potential, and many people do very well flipping foreclosures. But, there are also many REOs that are not good buys and may lose money.
All set to make an offer?
Most lenders have a department dedicated to REO that you’ll work on buying REO property from them. Commonly the REO department will use a listing agent to get their REO properties listed on the local MLS.
Before 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 what they know about the condition of the property and what their process is for accepting offers. Since banks typically 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 retract the offer if you find it. As with making any offer on real estate, providing documentation proving your ability to secure financing may make your offer more attractive, such as a pre-approval letter from a lender.
After you’ve submitted your offer, you can expect the bank to counter offer. At this point, it will be your decision whether to accept their counter or submit another counter offer. Be aware, you’ll be contending with a process that generally involves several people at the bank, and they don’t work evenings or weekends. It’s typical for the process of offers and counteroffers to take days or even weeks
Looking to Buy?