Bank Owned Real Estate FAQ - Should You Become a New Owner of an REO Property?

Bank Owned Real Estate FAQ - Should You Become a New Owner of an REO Property? You may have planned to buy a new house in a few years, but conditions in the real estate market makes a compelling case for looking at REO properties this year instead.

How does a property become an REO?

The house becomes REO when nobody bids on it during the foreclosure auction because the starting bid placed by the bank to recover its costs (mortgage balance and expenses) is higher than the market value of the house.

Why should I be interested in bank owned properties?

- REO properties are a great bargain today. REO homes are more affordable than buying new and other existing homes in the market. Buying REO properties is also less risky than properties acquired in foreclosure auctions; and involves less work, time, and emotional negotiations than buying short sale homes.

- The supply of foreclosure homes starting 2008 is the highest in recent history. Nineteen million homes were foreclosed in 2008 according to Realty Trac. The economic slowdown, continuing rise of unemployment numbers in the U.S., and tightening of credit are increasing the supply of foreclosure homes in the market.

Banks and mortgage lenders are becoming more motivated to price these houses lower to recover their capital and put a stop to their increasing expenses.

But once the economy recovers and new lending regulations and practices become the new norm, the supply of REO homes in the market will become limited and prices will once again favor lenders and banks.

Hence, the buying opportunity for REO homes today is considered a limited opportunity. It will end soon.

But what difficulties do buyers experience when dealing with a bank as a property seller?

Banks are in control of the REO process. There is not much room for the buyer to negotiate and buying the REO property means buying the property in its present condition.

And since various people required to approve REO sales may be located in a different state or even country from the property, slow responses and delays can be very frustrating. However, banks are working right now to make their processes more efficient.

What is the most effective way for new investors to participate in the REO market?

Investors, especially newbies should further reduce their risk and expenses by hiring experts.

If necessary, consult a financial expert to assess your capacity to purchase real estate. Are REO properties a bargain for you? Or are they in reality still above your means and you need to find partners or investors?

Hire an experienced realtor to help you find the best REO opportunities, reduce your risks, and place the most competitive bid right for you.

Hire a property inspector to correctly estimate the costs involve in making the property livable according to your standards.

Hence, don't just get swept by the REO crowd. Make certain that you have the proper advisors on your team in order to increase your chances of success.

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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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Condo under 10K, Atlanta (2 BR / 1 BA)

***HOT LEAD*** This condo is listed for $9,900. The address is 1425 SIMPSON RD, #C104, ATLANTA 30314. Jude Rasmus has the listing. You can contact them at the following:

Agent: Jude Rasmus
Phone: 770-321-1350
Office: RASMUS REAL ESTATE, INC.
Office: 770-321-1350



It's a large 2 bedroom, 1 bath, with separate livingroom. The condo building was built in 1965. The livingroom has access to a deck/porch.



Needs a little attention, but could be great investment for first-timers! Taxes are listed at $1,569 (2007).

Lot of cheap Atlanta foreclosures out there. Good luck if you decide to check it out.

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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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Check back often for leads on Cheap Atlanta Foreclosures and information on purchasing Cheap Atlanta Foreclosures!
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$9,500 Condo on North Avenue in Atlanta

Here's another cheap Atlanta foreclosure: Address: 710 NORTH AVE, #104, ATLANTA 30318, Subdivision: NORTH AVENUE CONDOS.


It’s a cozy 2 bedroom, 1 bathroom condo located in what appears to be a well maintained complex. It’s located near commuting, shops restaurants and entertainment on North Avenue in Atlanta.


The kitchen appears to be in solid, move-in shape.


Contact the agent below for more info:

Agent: Collis Clovie
Phone: 404-242-9070
Office: CENTURY 21 INTOWN
Office: 404-355-2833

Mortgage payments on this one could be well under $50 bucks per month! Super!

Are you investing? Check out Foreclosure-Millionaire blog for more tips and leads on cheap Atlanta foreclosures.

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Check back often for leads on Cheap Atlanta Foreclosures and information on purchasing Cheap Atlanta Foreclosures!
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