Real estate owned (REO) properties – also referred to as bank-owned properties – can be a great value and really help add to your potential home options in particularly competitive markets like Denver. Should you be considering an REO property? Here we cover the basics of REO homes and address some of the most common questions when it comes to making an REO property your new home.
What is an REO property?
REO stands for “real estate owned.” An REO property is one that has gone through the foreclosure auction process and didn’t sell. The house then becomes theproperty of the lender who authorized the initial loan.
How do I buy REO properties?
While REO properties aren’t all that different than traditional homes, there are some conditions you should know about. Because of this, it’s crucial to find an agent who specializes in REO sales. Agents specializing in REO sales can show you available listings, provide comparable information to other REO properties in the area, and help you determine the best offer price.
What are the benefits of buying an REO property?
Firstly, bank-owned properties come without liens (tax liens, mechanics liens, third-party liens, etc.) and other constraints. Additionally, REOs can often be listed below market value because the bank wants to get them off their books. Lastly, in the case of REOs, the lender is also the seller, so you have a better chance of negotiating better terms.
Just because REO properties aren’t as common as traditional sales doesn’t make them bad investments. In fact, REOs can present a great opportunity for buyers, especially if you have a pro on your side who can help guide you through the process. If you’re interested in checking out REO properties in the Denver area, contact Metrowest. We specialize in these types of sales and would love to help you get started!