Tips for Buying REOs
Tips for Buying Lender-Owned Properties (REOs)
Every buyer in this market wants a bargain! And while you may want to hit the jackpot by buying foreclosed properties – those homes that are offered as real estate-owned (REO), lender-owned or corporate-owned properties - it is essential to understand the differences between buying a “regular” listing and buying an REO.
Lenders are not in the business of owning real estate. Once they decide to foreclose on a home and on-sell it, they are looking for:
- More Money
- More Certainty
- Less Time
- Minimum Additional Investment
In addition, you should know that:
- REOs are normally PRICED BELOW MARKET.
- REOs have been VACANT for a period of time.
- REOs are offered “As-Is”.
- AGENTS who specialize in selling REOs normally cannot afford to spend much time on each property.
Knowing these facts, if you wish to be successful buying REOs, you need to design your buying strategy to appeal to the lender. Here are a few tips to help you:
- Show them the Money!
- Be aggressive an be prepared to compete for the purchase!
- Do your homework upfront!
- Structure your offer well.
- Cash offer is preferable (include proof of funds or full pre-approval letter)
- Ask for the number of offers in hand
- Offer a quick closing.
- Shorten the inspection period.
- Request the minimum number of contingencies (preferably NONE).
- Request the minimum amount in seller concessions (preferably NONE).
- Offer to split deed stamp costs equally with seller (in SC seller pays deed stamps of 0.0037 x sales price).
- Do not ask for any repairs upfront!
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Team BuyHomesInCharleston.com offers professional real estate services including buyer and seller representation in Charleston-Mount Pleasant, SC. For additional information please contact us at alan@BuyHomesInCharleston.com or by phone at (843) 416-1434.