Looking for REO property or a foreclosure in Las Vegas?
Investing in a bank-owned property is not something to be taken casually.
What's an REO?
"REO" or Real Estate Owned are houses which have completed the foreclosure process and are presently owned by the bank or mortgage company. This is different than a property 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 amassed during the foreclosure process. You must also be prepared to pay with cash in hand. And on top of all that, you'll get the property 100% as is. That possibly could include current liens and even current denizens that may require eviction.
A bank-owned property, on the contrary, is a much neater and attractive option. The REO property was unable to find a buyer during foreclosure auction. Now the bank 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.
Do be aware 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 usually requires sellers to make known any defects they are aware of. By hiring Realty ONE Group, you can rest assured knowing all parties are fulfilling Nevada state disclosure requirements.
Are REO properties a bargain in Las Vegas?
It's occasionally believed that any REO must be a steal and an opportunity for easy money. This isn't necessarily true. You have to be prudent about buying a repossession if your intent is make a profit. While it's true that the bank is typically eager to offload it fast, they are also motivated to minimize any losses.
Look carefully at the listing and sales prices of competing properties in the neighborhood when making an offer on 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 and selling foreclosures. But there are also many REOs that are not good buys and may not be money makers.
All set to make an offer?
Most banks have a department dedicated to REO that you'll work with while buying REO property from them. Typically the REO department will use a listing agent to get their REO properties listed on the local MLS.
Prior to 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 their knowledge concerning the condition of the property and what their process is for accepting offers. Since banks almost always sell REO properties "as is", it may be in your best interest to include an inspection contingency in your offer that gives you time to check for hidden damage and cancel the offer if you find it. If, as a buyer, you can provide documentation showing your ability to pay, 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 presented your offer, it's customary for the bank to make a counter offer. Then it will be your decision whether to accept their counter, or submit another counter offer. Your deal might be settled in one day, but that's usually not the case. Since offers and counter offers usually give the other party a day or longer to respond (and employees at a bank don't work nights or weekends) you could be looking at a week or longer.
Realty ONE Group 10750 W. Charleston Ste. 180 Las Vegas, NV 89135
Look carefully at the listing and sales prices of competing properties in the neighborhood when making an offer on 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 and selling foreclosures. But there are also many REOs that are not good buys and may not be money makers.
