Why Buying Bank REO Properties is Less Risky and Less Costly Than Bidding in Foreclosure Auctions

Why Buying Bank REO Properties is Less Risky and Less Costly Than Bidding in Foreclosure Auctions: There is less fear and uncertainty in buying REO properties than in bidding at foreclosure auctions. Below are 3 reasons why buying bank owned properties is a better choice for acquiring a new home.

1) With REO Properties, there is Less Chance in Overpaying for the Property

The atmosphere in auctions makes it more likely to influence investors to bid more for the property than they originally intended. Unlike placing offers on REO properties, buyers at auctions can't make the condition of a property a contingency on their bid. Auction bidders are not also provided the opportunity to perform due diligence inspections and title search before making a bid. Hence, they run a higher risk of ending up with a property that is more costly and troublesome to own.

2) Leaving the Responsibility of Eviction to the buyer Makes Foreclosure Auctions Unappealing

Banks take responsibility for evicting former owners and tenants in bank owned properties. However, in foreclosure auctions, the winning bidder is responsible for evicting the occupants of the house at his or her expense. Most Investors would rather not deal with evicting previous homeowners directly.

3) More Work in Acquiring Homes/Investment Properties in Foreclosure Auctions

During the time the property is in pre-foreclosure, some foreclosure auction bidders already try to initiate meetings with homeowners to be able to inspect the house just in case the house reaches final foreclosure. However, this work is unnecessary if you are bidding for REO properties, since you can inspect the property before making the bid. And unlike buying REO properties, buyers at auctions are responsible for clearing the liens in the property such as taxes, homeownership dues, utilities, and etc.

Hence it may be less work, less risk, and less costly in the long-run to focus your resources in buying REO properties than in bidding at foreclosure auctions.

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Craig Picard and Don Goff have helped 367 real estate investors grow their profits from buying and selling bank owned properties from zero to over $10,000 per month in only 3 months. To get your free CD "Foreclosure Investing Secrets" and learn how to profit during this recession go to http://www.REOInvestingRiches.com. Article Source: http://EzineArticles.com/?expert=Craig_Picard
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