The REO home buying process is similar to re-sale homes. There are some significant differences.
What is an REO?
REO simply stands for “Real Estate Owned” – it refers to property that is owned and in possession of the lender, as a result of a Foreclosure Process.
Where can I find a Utah REO home and who can buy them?
Anyone can buy an REO, whether you are a prospective homeowner or investor who wants a great deal on a home. There are lots of different sources for locating Utah REO homes – the best way is to contact your RCI agent and he or she can search the MLS and also access a list of Utah REO homes.
Another way to locate Utah REO homes is to directly contact lenders, but each one handles REO properties differently. Larger lenders post REO homes on their web sites in many cases, smaller lenders typically have one person in charge of the bank’s REO properties. Research can be quite time consuming if you are trying to do it on your own. At RCI Realty we have access to all of the available REO properties in Utah, as well as many directly with the lending institutions.
One of the biggest advantages of buying a Utah REO home is that you are purchasing a property without liens or other types of encumbrances – as in most cases, prior to a lender (bank) making an REO home available for sale, they will expunge all liens or claims against the property. This means there are no issues hanging over the property, be it a second or third mortgage, taxes, mechanics lien and/or any liens by creditors.
Working with our dedicated REO and Foreclosure team, we can negotiate directly with the lender’s loss mitigation department on your behalf to discount the price of the property, so it is priced below market value.
The shape of the home varies depending on lots of variables – remember the seller (bank or financial institution) does not make any representation or warranty relating to the condition of the property.
An inspection is very important when buying a Utah REO home and the purchaser pays for this expense. An inspection is important as you are buying a home that has been foreclosed and you need to know if there are any serious problems such as structural, electrical, septic, etc.
Dealing directly with a Bank or Financial Institution during the negotiation and closing process can be convoluted – let your RCI agent help you find and negotiate the right deal.
