Looking for REO property or a foreclosure in Clearwater?
Just as with any property purchase, your smartest move is to hire a professional real estate agent. If you have any questions regarding real estate in Clearwater, Florida, call me or send me an e-mail.
What's an REO?
"REO" or Real Estate Owned are houses which have completed the foreclosure process that the bank or mortgage company presently owns. This differs from 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 amassed during the foreclosure process. You must also be able to pay with cash in hand. Finally, you'll accept the property 100% as is. That possibly could involve current liens and even current occupants that need to be evicted.
A bank-owned property, conversely, is a more tidy and attractive proposition. The REO property was unable to find a buyer during foreclosure auction. The lender now owns it. The bank will handle the elimination of tax liens, evict occupants if needed and generally prepare 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 example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that ordinarily requires sellers to disclose any defects they are aware of. By hiring Bobby Rowe with John Doran Realty, you can rest assured knowing all parties are fulfilling Florida state disclosure requirements.
Are REO properties a bargain in Pinellas County?
It's sometimes thought that any foreclosure must be a steal and a possibility for easy money. This isn't necessarily true. You have to be cautious about buying a REO if your intent is make money. While it's true that the bank is often eager to sell it quickly, they are also motivated to get as much as they can for it.
When contemplating what to pay for 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. 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 may not be money makers.
All set to make an offer?
Most banks have staff dedicated to REO that you'll work with when buying REO property from them. Usually 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 their knowledge regarding the condition of the property and what their process is for getting offers. Since banks almost always sell REO properties "as is", you'll want to be sure and include an inspection contingency in your offer that gives you time to check for hidden damage and withdraw the offer if you find it. If, as a buyer, you can provide documentation showing your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any real estate offer.)
Once you've presented your offer, you can expect the bank to respond with a counter offer. At this point it will be your choice whether to accept their counter, or offer a counter to the counter offer. Be aware, you'll be dealing with a process that most likely involves multiple people at the bank, and they don't work evenings or weekends. It's not uncommon for there to be days or even weeks of going back and forth. Bobby Rowe with John Doran Realty is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no undue delays.
* MOL = More or Less
Bobby Rowe with CHARLES RUTENBERG REALTY 1545 S. Belcher Rd Clearwater, FL 33764
When contemplating what to pay for 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. 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 may not be money makers.
