How to Buy Bank Owned Properties or REO

Many foreclosed homes are excellent purchases.

Buying bank-owned properties, commonly referred to as REO properties, is easier today due to the many websites available to locate desirable property. Banks and government mortgage insurance companies have made their foreclosure information public access available for easy previewing of properties at home. These websites are valuable tools to use both when using a Realtor or looking alone. These sites enable you to do much of the preliminary screening for real estate investment properties.

Instructions

1. Look for websites of local banks and lending institutions. Many of these banks have links on their homepage or mortgage page that will lead to a list of foreclosed property. You will need to make an appointment with a Realtor to tour these homes but you can get a good deal of information from the bank website including pictures and the listing price of the property. The listing price may also be negotiable.

2. Check with your personal banker for additional information about the purchase of REO properties from your bank. Your banker will inform you of the procedure to view and make an offer on any property being sold by the bank. These details will be for each bank or lending institution.

3. Search for government-foreclosed properties that are insured by government sponsored mortgage insurance companies such as Fannie Mae and Freddie Mac. These properties listing will include detailed property information.

4. Write the contract on the property you are buying from the bank. REO contracts are real estate contracts that are usually written by a Realtor or a lawyer. Include in the contract the specific items that will stay with the property, such as appliances. Be clear about the time for the contract to be completed and include the exact date the contract will be void if either party cannot close the sale at that time. The contract will need to have a clause that lets the bank know that you accept the property "as is."

References

• Bank of America Home Loans
• Freddie Mac Homes
• Fannie Mae Homes
• National Home Management Solutions
• AltisourceHomes: Online bidding for REO