Looking for REO property or a foreclosure in Fort Myers?
Smart consumers will turn to a seasoned pro when considering a foreclosed property.
What's an REO?
"REO" is short for Real Estate Owned. These are houses which have completed the foreclosure process that the bank or mortgage company now possesses. This is not the same as real estate up for foreclosure auction.
When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees amassed during the foreclosure process. The buyer must also be prepared to pay with cash in hand. And on top of all that, you'll get the property completely as is. That possibly will include standing liens and even current tenants that may require removal.
A bank-owned property, on the other hand, is a much neater and attractive deal. The REO property didn't find a buyer during foreclosure auction. The lender now owns it. The lender will handle the removal of tax liens, evict occupants if needed and generally plan for the issuance of a title insurance policy to the buyer at closing.
Note that REOs may be exempt from typical disclosure requirements.
For example, in California, banks are not required to give a Transfer Disclosure Statement,
a document that ordinarily requires sellers to tell you about any defects they are informed of.
By hiring RockStar Realty, you can rest assured knowing all parties are fulfilling Florida state disclosure requirements.
Is REO property in Fort Myers a bargain?
It's sometimes thought that any foreclosure must be a bargain and a possibility for guaranteed profit. This simply isn't true. You have to be prudent about buying a REO if your intent is to make a profit. While it's true that the bank is typically anxious to sell it soon, they are also looking to minimize any losses.
Look closely at the listing and sales prices of comparable homes in the neighborhood when considering the purchase of an REO. And factor in any repairs or upgrades necessary to prepare the house for resale or moving in.
The bargains with money making potential exist, and many people do very well buying foreclosures. Still, there are also many REOs that are not good buys and not likely to turn a profit.
Ready to make an offer?
Most banks have a department dedicated to REO that you'll work with when 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 find out as much as you can about what they know concerning the condition of the property and what their process is for receiving offers. Since banks almost always sell REO properties "as is", it's often prudent to include an inspection contingency in your offer that gives you time to check for unknown damage and retract the offer if you find it.
If, as a buyer, you can provide documentation proving your ability to secure financing, 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 real estate offer.)
Once you've submitted your offer, it's customary for the bank to make a counter offer. From there it will be your choice whether to accept their counter, or offer a counter to the counter offer.
Understand, you'll be contending with a process that usually involves multiple people at the bank, and they don't work evenings or weekends. It's not uncommon for the process of offers and counter offers to take days or even weeks.