Buying REO property or a foreclosure in Mifflintown?

Purchasing a bank-owned property is not something to be taken casually.

What's an REO?

"REO" or Real Estate Owned are houses which have been through foreclosure and are now held by the bank or mortgage company. This is not the same as a property up for foreclosure auction. Jack Gaughen Network Services Hower & Associates has experience to share with foreclosures and bank owned properties in Mifflintown, Pennsylvania

If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees amassed during the foreclosure process. You must also be willing to pay with cash in hand. And on top of all that, you'll get the property completely as is. That could consist of current liens and even current denizens that may require expulsion.

A bank-owned property, conversely, is a more tidy and attractive deal. The REO property didn't find a buyer during foreclosure auction. Now the lender owns it. The lender will attend to the elimination of tax liens, evict occupants if needed and generally prepare for the issuance of a title insurance policy to the buyer at closing.

You should be aware that REOs may be exempt from standard disclosure requirements. For example, in Texas, it is optional for foreclosures to have a Property Disclosure Statement, a document that usually requires sellers to tell you about any defects of which they are aware. By hiring Jack Gaughen Network Services Hower & Associates, you can rest assured knowing all parties are fulfilling Pennsylvania state disclosure requirements.

Is REO property in Mifflintown a bargain?

It's commonly assumed that any foreclosure must be a good deal and a chance for easy money. This frequently isn't true. You have to be very careful about buying a repossession if your intent is to make a profit. While it's true that the bank is often eager to offload it soon, they are also motivated to minimize any losses.

Jack Gaughen Network Services Hower & Associates has experience to share with foreclosures and bank owned properties in Mifflintown, Pennsylvania When pondering the value of a foreclosure, carefully analyze comparable sales in the neighborhood and be sure to take into account the time and cost of any repairs or remodeling needed to prepare the house for resale. The bargains with money making potential exist, and many people do very well flipping foreclosures. But, there are also many REOs that are not good buys and not likely to turn a profit.

All set to make an offer?

Most lenders have staff dedicated to REO that you'll work with while buying REO property from them. To get their properties advertised on the local MLS, the lender will frequently use a listing agent.

Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and learn as much as you can about what they know regarding the condition of the property and what their process is for receiving offers. Since banks most commonly sell REO properties "as is", it may be in your best interest to include an inspection contingency in your offer that gives you time to check for unknown damage and cancel the offer if you find it. If, as a buyer, you can provide documentation showing your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any type of real estate offer.)

After you've submitted your offer, it's customary for the bank to make a counter offer. Then it will be up to you to decide whether to accept their counter, or make another counter offer. Realize, you'll be dealing with a process that usually involves several people at the bank, and they don't work evenings or weekends. It's quite common for the process of offers and counter offers to take days or even weeks.

lipping foreclosures. Still there are also many REOs that are not good buys and may lose money.

Time to make an offer?

Most lenders have a department dedicated to REO that you'll work with when buying REO property from them. To get their properties advertised on the local MLS, the lender will typically hire a listing agent.

Prior to making your offer, you'll want to contact either the listing agent or REO department at the bank and find out as much as you can about what they know about the condition of the property and what their process is for taking offers. Since banks usually sell REO properties "as is", you may want to include an inspection contingency in your offer that gives you time to check for unseen damage and terminate the offer if you find it. If, as a buyer, you can provide documentation demonstrating your ability to pay, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This is generally true for any type of real estate offer.)

After you've submitted your offer, it's customary for the bank to respond with a counter offer. From there it will be your choice whether to accept their counter, or offer a counter to the counter offer. Understand, you'll be contending with a process that most likely involves multiple people at the bank, and they don't work evenings or weekends. It's typical for there to be days or even weeks of going back and forth.