“REO’s” (Real Estate Owned) are foreclosures taken back by the lending institution that lent money on them. Each institution has different rules, addendums, forms and timelines that they abide by.
Realtors that have buyers who want to buy “bank owned” properties should be familiar with some of the more common rules that are “across the board” with all of the institutions, so they can pass it on to their buyers and their buyers will know what they are getting into.
Some of these common rules are as follows:
1. Taxes are always prorated 100% of the previous year.
2. The seller side does not order or pay for the survey. Most buyers’ lenders require them. The buyers’ side must order and pay for them.
3. There is no bill of sale on the personal property. The seller institution only foreclosed on the real estate not on the personal property.
4. All offers must either have a prequalification letter from a lender or proof of funds for cash deals.
5. All of the information in the MLS is true to the best of our knowledge but we DO NOT GUARANTEE any information.
6. We supply the Homeowners Association information or management company information to the buyers’ agent, but it’s the BUYER’S responsibility to contact them immediately, ask all questions the buyer may have. Buyer is responsible for verifying all assessment information and to cooperate with the association in following their rules for a smooth ontime closing.
7. We encourage home inspections. We try to get utilities on at all of our properties. Many properties are winterized therefore, you must contact our office for details of when to schedule the home inspection. Please do be aware that the seller institution IS SELLING THE PROPERTY IN AS IS CONDITION.
8. Close Dates are EXTREMELY important to the institutions so they
Estimate their assets and liabilities in inventory. Please give yourself enough time in the offer realizing that you are dealing with an REO that may be winterized and may have issues. We would much rather have you ask for a 45-60 realistic close date vs. 2 weeks, when we know it’s impossible. The seller institutions are furious when properties don’t close on time.
9. Seller does not provide garage door openers and mailbox keys.
10. Open communication between the real estate agents and attorneys and buyers’ lender are a must. If there is a problem with the mortgage we would much rather know NOW rather than later.
Buyers, Inquire Here
I only work the listing side of the transaction. If you have a general inquiry about this property please complete the information below and someone from my office will get back to you. If you are a buyer and would like more information, please complete the form below indicating you are a buyer and a real estate agent will respond to your request for information.