Looking for REO property or a foreclosure in Virginia Beach?
Foreclosed upon and bank owned property purchases require the assistance of an experience professional.
What's an REO?
"REO" means Real Estate Owned. These are houses which have been foreclosed upon and are currently owned by the bank or mortgage company. This is different than 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 added during the foreclosure process. The buyer must also be prepared to pay with cash in hand. Finally, you'll accept the property entirely as is. That possibly will involve prevailing liens and even current residents that may require eviction.
A bank-owned property, by contrast, is a much neater and attractive proposition. The REO property was unable to find a buyer during foreclosure auction. The bank now owns it. The bank will take care of the elimination of tax liens, evict occupants if needed and generally organize for the issuance of a title insurance policy to the buyer at closing.
Take notice that REOs may be exempt from standard 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 aware of.
By hiring Rose & Womble, you can rest assured knowing all parties are fulfilling Virginia state disclosure requirements.
Is REO property in Virginia Beach a bargain?
It's occasionally thought that any REO must be a good deal and a possibility for easy money. This isn't necessarily true. You have to be cautious about buying a repossession if your intent is make money. While it's true that the bank is typically eager to offload it fast, they are also looking to minimize any losses.
Look carefully at the listing and sales prices of comparable homes in the neighborhood when considering the purchase of an REO. And factor in any repairs or upgrades necessary to prepare the house for resale or moving in.
The bargains with money making potential exist, and many people do very well buying foreclosures. Still there are also many REOs that are not good buys and may lose money.
Time to make an offer?
Most mortgage companies 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 often 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 find out as much as you can about their knowledge regarding the condition of the property and what their process is for getting 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 unknown damage and cancel the offer if you find it.
If, as a buyer, you can provide documentation demonstrating your ability to secure financing, such as a pre-approval letter from a lender, your offer will be more attractive and likely be accepted. (This goes for any real estate offer.)
After you've submitted your offer, it's customary for the bank to respond with a counter offer. At this point it will be your choice whether to accept their counter, or offer a counter to the counter offer.
Be aware, you'll be working with a process that probably 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.
Rose & Womble 3148 Shore Drive Virginia Beach, VA 23451
Look carefully at the listing and sales prices of comparable homes in the neighborhood when considering the purchase of an REO. And factor in any repairs or upgrades necessary to prepare the house for resale or moving in.
The bargains with money making potential exist, and many people do very well buying foreclosures. Still there are also many REOs that are not good buys and may lose money.
