The subprime mortgage foreclosure crisis has created a historic level of REO (bank-owned) properties on the market. This trend has contributed to a decrease in housing prices and created a whole new level of affordability for buyers. First-time buyers that want to get the most value for their first investment should consider REOs as an option.
The benefits of buying an REO are:
- Price – Typically foreclosures are aggressively priced to sell. Banks are eager to sell them and will price them low to ensure a quick transaction;
- Extra bargaining leverage – Banks usually want to sell a property within 90 days of listing and are usually willing to negotiate with buyers. This is an advantage over dealing with a homeowner-seller;
- Competitive interest rates can help make an REO purchase more affordable than renting;
- If purchased with FHA or VA loans, buyers only pay 3 percent of closing costs;
- REOs usually have good title, property taxes, and repairs may have been made by the lender;
- If you gain equity on your home, you can borrow against the home's equity for home improvements, college tuition, medical costs etc;
If you decide that an REO is for you, read some of our tips for making your purchase a successful one.
- Why Buy An REO?
- Tips For Buying An REO
- Connecting With An Advisor
- Financing Options That Work Best for REO Buyers
- How To Seminar Events