Bank Owned Real Estate

Learn How to Negotiate The Sale of Bank Owned Foreclosures

Buying bank owned real estate, short sales and bank foreclosed properties can be very profitable, if you know how to negotiate with the bank.

Something you should know is most of the people you talk to do not know much about real estate.

BANK OWNED REAL ESTATE: Dealing with banks and buying foreclosures may create some legal problems along the way, so learn how to handle legal issues on your own. Go to: Jurisdictionary and look at the FREE Instructional Videos. Left Side Half Way Down...

About 60% of the banks REO department employees are temporary employes with very little real estate knowledge. So don't be surprised when they cannot answer your questions.

People buying bank owned homes are finding some excellent buying opportunities because the banks are swamped with foreclosures. Anyone hunting for bank owned real estate can find some exciting real estate values because of the over supply.

Don't wait around too long because the supply is going to dry up when the veterans start coming home. Buying bank owned property is just like anything you do there is a learning curve.

The problem is by the time you learn how to do it the party will be over. For some additional help go to: REO listings for additional information.

The first thing to know is the difference between REO (real estate owned) and pre-foreclosed property.

1. REO is property that has been though the foreclosure process and is now owned by a bank or the real estate lender that made the loan.

2. Foreclosure is the process a lender must go through to recover the real estate when there his a mortgage loan on the property and it goes into default.

Before you start buying real estate you may want to look up what your states foreclosure laws have to say because some states give the owners redemption rights. This means the property owner can buy back her home.

There is one more bit of good information to know. Most real estate loans are not secured with mortgages. Lenders use Deeds of Trust. The term mortgage is a carryover from the past when mortgages were popular. Today most real estate lenders use Trust Deeds because they have different foreclosure rules.

Now day's, Deeds of Trust are used to secure real estate loans because they easier to foreclose and the time required to foreclose is much shorter than a mortgage loan. In most states there is no redemption period on Deeds of Trust.

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• Study the Real Estate Market Cycle Theory on this site.

• Read-up on Real Estate Values in your market area.

• Hire competent Savvy Realtors and get a Buyer/Agent to work for you because all real estate people work for the seller unless you have hired them to be your agent.

• If you intend to finance part of the purchase arrange your loan well in advance because then you will know what your qualified for.

Right now there’s tons of Bank Owned Real Estate on the market or in the process of being placed on the market. Because of the current economic situation homes are going cheap, but this will not last forever...

Cheap Real Estate Will Disappear Soon, So Get Moving Now.

In some parts of the country the over supply will vanish by the middle of 2012. Once the housing market corrects its self you can expect to see the price of existing homes increase.

For more information check out the real estate Market Cycle theory on this site. You will often hear the term REO which is an acronym for "Real Estate Owned" by a bank or a lender. An REO has gone through the foreclosure process and is now owned by the lender that made the original loan.

REO’s become a liability to the lender because it reduces their ability to borrow funds from other banks.

For the above reason most lenders want to sell the property fast without doing any repairs or taking on any additional liability.

For all the above reasons most but not all Bank Owned Real Estate is offered for sale "As Is" at discounted prices.

If the Bank takes on the responsibility of refurbishing homes they would use licensed, bonded and insured contractors. This will increase the cost by about double plus they are on the hook if the work is less than perfect.

Buying bank owned real estate can offer some serious savings to home buyers that are willing to do some clean-up and painting.

Make sure that your purchase contract states that the seller "Bank" provides Title Insurance and all property taxes and any liens are paid off before you take title.

When buying Bank Owned Real Estate it is a good idea to order a home inspection. This may be the best money you ever spend.

Unless you’re a professional contractor do not take the chance, pay for a home inspection because some repairs can cost thousands of dollars to correct.

P.S. Time Flies Cheap Real Estate Will Not Be Around For Ever.

For more information about bank owned real estate be sure to read other pages on this site.

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