What exactly is a REO? Simply put a REO is a bank owned property. Due to the increasing number of REO’s, they are bound to come up in your real estate comps searches. And in turn, bulk REO’s are foreclosed properties owned by banks that are packaged together, and sold at steeply discounted prices. These can range from five properties to hundreds sold in the package.
Guys, you can benefit from this new real estate concept because banks no longer want the “financial headache” of paying property taxes, hazardous insurance, utilities, and maintenance costs attached to these distressed properties. Banks, and other lending institutions, are not in the business of managing properties. They provide hard money (aka cash) and credit to clients; therefore banks have no financial gain by having properties on their books.
Traditionally, after a property becomes repossessed and classified as REO (Real Estate Owned), the bank will attempt to resell the property to the public on its own, or solicit the services of an REO Asset Manger. The problem in this economy is the overwhelming number of foreclosed properties, compelling banks to seek non-traditional ways to get rid of their dead weight. Selling properties in Bulk REO is the most efficient way for banks to balance their financial books while remaining in compliance with Federal and State bank regulations.
When researching with InvestorCompsOnline take an opportunity to consider bulk REO’s, you will be glad you did!