REO – Real Estate Owned

Info seen today–

The percentage  of homes on the local market for sale which are, in fact, REO’s has increased. Strategies for dealing with the holders of these properties are somewhat different than purchasing from a private citizen. Those differences can be looked as potential landmines if you are not familiar with the process.

  • Landmine # 1.  Most REO properties are sold using a standardized contract which will be used throughout the nation. ( for instance, HUD, Fannie Mae, VA). The language and terms in these contracts will supercede anything you write in your local purchase agreement, therefore, it is critical that you understand all the language in their standard contract.
  • Landmine # 2. Most REO properties are sold “as is.”  While entities must allow for an independent inspection if one is allowed by state law, there is no requirement that any repairs be made as a result of the inspection.
  • Landmine # 3. Buyers are frequently charged a per day fee for  delays in closing caused by their side of the transaction. Whether  caused by the borrower, their lender or the realtor does not matter. It is not uncommon for the delay fee to be $100.00 per day.
  • Landmine # 4. Transfer of title will usually be granted with a special warranty deed or a Sheriff’s deed.  Both provide a MARKETABLE title; not CLEAR title.  It is common for liens to remain attached.
  • Landmine # 5. When submitting an offer on an REO property, you buy the whole “kit and kaboodle”.

Comments

  1. postal rates says:

    2 wrecks now in Brunswick county. US 17 near Jones Ford and the second Ocean Isle Beach Rd. and US 17.

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