Making an offer on REO property or a foreclosure in Waldorf?


	Making an offer on a bank-owned property is not something to be taken casually. Should you have questions about real estate in Waldorf, Maryland, call me or send me an e-mail.

What's an REO?

"REO" or Real Estate Owned are properties which have been foreclosed upon and are currently held by the bank or mortgage company. This is not the same as a property up for foreclosure auction. Century 21 New Millennium has experience to share with foreclosures and bank owned properties in Waldorf, Maryland

Century 21 New Millennium has experience to share with foreclosures and bank owned properties in Waldorf, Maryland

When buying a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees added during the foreclosure process. The buyer must also be willing to pay with cash in hand. To top everything off, you'll get the property 100% as is. That could include prevailing liens and even current denizens that may require eviction.

A bank-owned property, by contrast, is a much neater and attractive option. The REO property did not find a buyer during foreclosure auction. Now the lender owns it. The bank will see to the removal of tax liens, evict occupants if needed and generally plan for the issuance of a title insurance policy to the buyer at closing.

Note that REOs may be exempt from typical disclosure requirements. In California, for example, banks are not required to give a Transfer Disclosure Statement, a document that usually requires sellers to make known any defects they are knowledgeable of. By hiring Century 21 New Millennium, you can rest assured knowing all parties are fulfilling Maryland state disclosure requirements.

Is REO property in Waldorf a bargain?

It is frequently thought that any foreclosure must be a good deal and a chance for guaranteed profit. This isn't always the case. You have to be very careful about buying a repossession if your intent is make a profit. Even though the bank is often anxious to offload it quickly, they are also looking to get as much as they can for it.

Century 21 New Millennium has experience to share with foreclosures and bank owned properties in Waldorf, Maryland

When considering what to pay for a foreclosure, 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. It is possible to find REOs with money-making potential, and many people do very well buying foreclosures. Still there are also many REOs that are not good buys and not likely to turn a profit.

Time to make an offer?

Most banks have a department dedicated to REO that you'll work with while buying REO property from them. To get their properties advertised on the local MLS, the lender will typically use a listing agent.

Before making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about what they know about the condition of the property and what their process is for taking offers. Since banks typically sell REO properties "as is", you may want to include an inspection contingency in your offer that gives you time to check for unknown damage and withdraw the offer if you find it. As with making any offer on real estate, providing documentation proving your ability to pay may make your offer more attractive, such as a pre-approval letter from a lender.

Once you've made your offer, you can expect the bank to counter offer. At this point it will be your decision whether to accept their counter, or make another counter offer. Your transaction might be final in one day, but that's usually not the case. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.