What exactly is an REO? The term REO has been discussed in many publications concerning property sales, on the assumption that the reader knows what REO means. Here is a brief explanation of REO, so you, as a prospective investor, can take advantage of the information out there on it. Using your InvestorComps account to access real estate comps will prepare you to make smart financial decisions these regarding properties.
REO or “a real estate owned property, means the bank or lending institution has full ownership of the property. You can think of it as a property that has “defaulted.” However, REO is a bit different from plain foreclosure. Let us look more closely at the process by which a property becomes REO. First, the party making payments on the house misses payments, to the extent that the property becomes foreclosed. The lending entity to which the person was making the payments usually tries to short sell the property, or put it on the block at a foreclosure auction. The bank will most likely be looking to sell the house or apartment for at least the remaining amount of money owed to it by the previous resident. Thus, the asking price has already been reduced, sometimes significantly. However, if a buyer or investor may not be found,
If you are interested in REO properties as investment real estate,
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