Carla Harden, Realtor
Your Residential Real Estate Specialist
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There is a lot of interest in buying bank owned properties these days. A lot of information, some good and some bad, is floating around about the subject.   Often the information offered is for sale, with the promise that you can make a lot of money with little effort once you know “the secret formula”.  The fact is that there are no secrets, and to make money does require effort. 

BANK OWNED PROPERTIES (REOs) IN RIO VISTA   There are many bank owned properties for sale in Rio Vista.  More are coming and many are in pre-foreclosure. The prices are rock bottom.  Prices are extraordinary.  In town homes have been as low as $100,000 and in Homecoming, $149,000.  In Trilogy, the price of the lowest home sold was $122,000.  You can find unbelievable homes at amazing prices in great locations!  These deals won't be seen again.  Be ready to bid when it comes on the market.   All bank owned homes are listed under Rio Vista Listings or Trilogy Listings.  Most of the lower priced homes are bank owned.  For more information on a specific home or to schedule a visit, please call 707 330-0808 or send an e mail,   

REO stands for “Real Estate Owned”.  These are properties that have gone through foreclosure and are now owned by the bank or mortgage company.  This is not the same as a property up for foreclosure auction.  A REO is a very clean and attractive transaction.  The REO property did not find a buyer during foreclosure auction.  The bank now owns it.  The bank will see to the removal of tax liens, evict occupants if needed and generally prepare for the issuance of a clear title insurance policy to the buyer at closing.  Do be aware that REO’s may be exempt from normal disclosure requirements.  In California, for example, banks are exempt from giving a Transfer Disclosure Statement, a document that normally requires sellers to tell you about any defects they are aware of.  The bank will not know a lot about the property.

KNOW WHAT TO EXPECT, SELECT A SAVVY AGENT WHO KNOWS THE PROCESS   Make sure you select an agent who understands the process of buying an REO who can explain the process to you.  Buying an REO is a little different.  You want to be protected.  There are several clauses in the purchase contract that protect you, that allow you to back out if you find the house isn't what you expected or if you have concerns about rising interest rates.  You absolutely need certain items written into the contract on your behalf. 

There are ways to obtain benefits for you from the bank.  Your agent should know what these are and how to get them for you.  Make sure your agent 1.  Saves you thousands of dollars on an REO purchase   2.  Helps get your closing costs paid for  3.  Structures the offer to beat out the competition.  You need a savvy agent and you need to know what to expect from the other side and what to write to make the deal happen! 

Most banks have a REO department.  Typically the REO department will use an agent to get their REO properties listed on the local MLS.  Before making your offer, you will will need a real estate agent who can structure an offer for you and who knows the process of submitting offers to the bank. Since banks almost always sell REO properties “as is”, you’ll want to be sure and include an inspection contingency in your offer that gives you time to check for hidden damage and terminate 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 made your offer, the bank may make a counter offer.  Then it will be up to you to decide whether to accept their counter, or offer a counter to the counter offer.  Realize, you’ll be dealing with a process that probably involves multiple people at the bank, and they don’t work evenings or weekends.  It’s not unusual for the process of offers and counter offers to take days to secure an answer.

It’s commonly assumed that any REO must be a bargain and an opportunity for easy money.  You have to be very careful about buying a REO if your intent is to make money off of it.  While it’s true that the bank is typically anxious to sell it quickly, they are also strongly motivated to get as much as they can for it.  When considering the value of a REO, 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 foreclosures, however, you may need to hold the property for a while to turn a profit.