Buying REO property or a foreclosure in Guerneville?


	Just as with any home purchase, your wisest move is to hire a professional real estate agent. For more information, just contact me through my site or e-mail me. I'm happy to answer any questions you have about real estate foreclosures.

What's an REO?

"REO" is an abbreviation for Real Estate Owned. These are homes which have been through foreclosure and are presently owned by the bank or mortgage company. This is not the same as real estate up for foreclosure auction. Herth Wine Country has experience to share with foreclosures and bank owned properties in Guerneville, California

Herth Wine Country has experience to share with foreclosures and bank owned properties in Guerneville, California

When buying 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. You must also be willing to pay with cash in hand. And on top of all that, you'll receive the property totally as is. That could consist of prevailing liens and even current tenants that need to be expelled.

A bank-owned property, by contrast, is a much cleaner and attractive proposition. The REO property didn't find a buyer during foreclosure auction. Now the bank owns it. The bank will deal with 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.

You should be aware that REOs may be exempt from typical disclosure requirements. For instance, in California, banks do not have to give a Transfer Disclosure Statement, a document that ordinarily requires sellers to tell you about any defects they are informed of. By hiring Herth Wine Country, you can rest assured knowing all parties are fulfilling California state disclosure requirements.

Am I guaranteed a good deal when purchasing a bank owned property in Guerneville?

It's sometimes believed that any foreclosure must be a good buy and an opportunity for guaranteed profit. This frequently isn't true. You have to be cautious about buying a REO if your intent is profit from the sale. Even though the bank is typically eager to sell it fast, they are also motivated to get as much as they can for it.

Herth Wine Country has experience to share with foreclosures and bank owned properties in Guerneville, California

When considering the value of REO property, you need to look closely at comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. 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 not likely to turn a profit.

All set to make an offer?

Most mortgage companies have a department dedicated to REO that you'll work with in buying REO property from them. Normally the REO department will use a listing agent to get their REO properties listed on the local MLS.

Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and learn as much as you can about their knowledge about the condition of the property and what their process is for taking offers. Since banks usually 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 unknown damage and terminate the offer if you find it. If, as a buyer, you can provide documentation proving your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This is generally true for any type of real estate offer.)

Once you've presented your offer, you can expect the bank to make a counter offer. Then it will be your decision whether to accept their counter, or offer a counter to the counter offer. Your deal might be final in a single day, but that's rare. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.