With REO properties flooding the market, is it time for you to add them to your real estate investing business?
The simple answer is yes! The fact is, REO properties make up the majority of “REAL DEALS” in this market and you need to be taking advantage of this great opportunity.
Here are 5 reasons REO properties are the way to go!
- Bank Has Already Taken Loss
First and foremost, if the property is an REO, then the bank has most likely already gone through a lengthy and expensive foreclosure process and hasn’t seen a nickel on the properties for the last 1 to 2 years. Long story short, they have already conceded and taken the majority of the loss. Their main focus now is to simply get rid of the property as quick as possible. - Banks Make for BAD Landlords
Banks also don’t make for great landlords and have no intentions of being landlords. Banks make their money off loaning money; not own defaulted properties. For several reasons along with several federal regulations, the best thing for the banks to do is to get these properties off of the books and move on. This means deep discounts for you! - Property Chased the Market All the Way Down
Also, it is very likely that the REO property “chased the market” all the way down to rock-bottom before the bank finally took possession. Now, they are competing with the rest of the properties on the market and need to discount the properties even more just to compete with the competition. Remember, they NEED to get rid of their REO inventory and get back to their main business of loaning money. - Low Value No Longer Means “Trashed” Property
Use to be that the vast majority of REO properties on the market probably ended in a long, lengthy rehab. While rehabbing is a great option for many REO properties, it may not be for everyone. The good news is that many of the REOs coming on the market today are actually in great shape. That means you are getting a property at a rock-bottom price that doesn’t need much work (or money) at all. - Less Time – More Deals
Another great aspect regarding REO properties is that your start-to-finish time for your deals is cut in half. For many of the reasons listed above, negations are normally quick. The banks really have no emotion involved which can make negotiations go faster and more businesslike. Generally, once you’ve agreed on a price, things move pretty fast. This means less time on each property and more deals!
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Heather, I have been posting and emailing all of my contacts, family, our senators, reps, etc.I was in the mortgage industry for over 27 years and was aware of this agreement way back when. However it was never brought to light until now because of the sweet, to say the least deal that OneWest got!! This is insanity and a travesty to all homeowners and taxpayers.! We as loan originators were like the bottom of this mess. The allowed wall street hedge fund managers to create this exotic products that generated million’s in commissions for them and yet who saved them?? We did as taxpayers. We need to unite together on this issue and let our President know how we feel and something needs to be done immediately!! Indymac is one of the worst to have loan mods done. We need to be on the offense not defense..After all, they are the ones that got the bailout from FDIC. I say lets ROCK the Nation with this issue..