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Looking for REO property or a foreclosure in Lowell?
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Foreclosed upon and bank owned property purchases require the assistance of an experience professional.
Should you have questions regarding real estate in Lowell, Michigan, call me or send me an e-mail.
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What is an REO?
"REO" stands for Real Estate Owned. These are houses which have been foreclosed upon and are now held by the bank or mortgage company. This is unlike real estate up for foreclosure auction.
If you buy a property during a foreclosure sale, you must pay at least the loan balance plus any interest and other fees accumulated during the foreclosure process. The buyer must also be prepared to pay with cash in hand. Finally, you'll get the property entirely as is. That possibly may include existing liens and even current tenants that may require removal.
A bank-owned property, by contrast, is a much cleaner and attractive transaction. The REO property was unable to find a buyer during foreclosure auction. Now the bank owns it. The lender will see to the removal of tax liens, evict occupants if needed and generally prepare for the issuance of a title insurance policy to the buyer at closing.
Take notice that REOs may be exempt from normal disclosure requirements.
For example, in California, banks are not required to give a Transfer Disclosure Statement,
a document that normally requires sellers to reveal any defects they are informed of.
By hiring Coldwell Banker-Hoppough & Associates /Hidden Acre Develpment Company Inc, you can rest assured knowing all parties are fulfilling Michigan state disclosure requirements.
Is REO property in Lowell a bargain?
It is occasionally thought that any foreclosure must be a good buy and an opportunity for easy money. This frequently isn't true. You have to be very careful about buying a repossession if your intent is profit from the sale. Even though the bank is typically eager to sell it fast, they are also motivated to minimize any losses.
When pondering the value of a foreclosure, you need to look closely at 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 buying and selling foreclosures. However there are also many REOs that are not good buys and may lose money.
Prepared 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 frequently hire a listing agent.
Before 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 almost always 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 retract the offer if you find it.
As with making any offer on real estate, you'll make your offer more attractive if you can include documentation of your ability to pay, such as a pre-approval letter from a lender.
After you've submitted your offer, you can expect the bank to respond with a counter offer. At this point it will be your choice whether to accept their counter, or submit another counter offer.
Your transaction might be settled in one day, but that's rare. Since offers and counter offers usually allow a day or more for the other party to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer. Coldwell Banker-Hoppough & Associates /Hidden Acre Develpment Company Inc is are used to working around the schedules of this type of seller and will do everything possible to ensure there are no undue delays.
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Coldwell Banker-Hoppough & Associates /Hidden Acre Develpment Company Inc 11630 E. Fulton Lowell, MI 49331
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