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| Investment in Real Estate Owned Property |
The single most important aspect of R.E.O. investing involves finding and working with a Real Estate agent.
If a foreclosure property is being considered out of the area or state, then working with a local agent in that area -who can advise on the condition, knowledgable about the growth potential, advise on local conditions, is an important relationship to develop. |
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What’s the easiest way to make money on a foreclosure home?
Purchase a foreclosure home that needs some repairs (over $5,000.00) and apply for a 203k loan. |
| Investment Tips |
Perhaps the easiest way to buy foreclosure property is to buy REOs ("real estate owned"). An REO occurs when the mortgage lender takes back the home to gain possession and cut its losses. The lender, however, does not want the home because it is not in the real estate business and is therefore usually motivated to move the property quickly.
Pros of buying an REO: The lender is almost always the senior lien holder, thereby wiping out all other liens at the auction. This means an REO will always have clear title, which saves a lot of time, expense and worry when buying a foreclosure home. Most likely, the mortgage lender will also have paid any property taxes in arrears. The lender may either repair the property to acceptable standards or allow a discount to the buyer to accomplish the repairs.
Cons of buying an REO: Rewards follow risk: this is a low risk investing method and the rewards can be on the low side as well. Average savings may range from only 5% to 15% off market value, although discounts of 25% or more are possible if you know how. Investing in foreclosure homes can provide excellent profits. Each of the three foreclosure opportunities presented here offer both rewards and certain risks. Be sure to do your homework before you buy. |
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REO is an acronym for “Real Estate Owned,” which indicates that the home has been foreclosed upon and is currently on the market or soon will be.
The foreclosure homes found on GovernmentAsseSales.com have been collected and assimilated from literally hundreds of REO warehouses from every state in the United States, Puerto Rico, US Virgin Islands and Guam.
GovernmentAsseSales.com focuses on locally owned banks and some of the largest providers of secondary mortgage money in the world. For years, banks were not willing to allow their REO inventory be published for fear that their shareholders would look upon their foreclosure home inventory as a failure to secure mortgage money wisely.
The outlook on foreclosure homes (REOs) that banks have does not take into consideration the 4-5% foreclosure rate that has remained consistent for the past 20 years. Many stockholders do not understand this simple constant. Fortunately, banks and lending institutions have become wiser and have educated their stockholders about the basic facts of foreclosure homes. |
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