What Are the Advantages of Buying an REO Property?
The lender, typically a bank, that owns an REO property wants to sell it quickly. This lender is not in the property business and does not want to keep owning the property or paying taxes and maintenance costs. Therefore, REO property is likely to be less expensive and below market value so that the lender can sell it as soon as possible. By purchasing an REO property, you can hopefully save money.
Additionally, the REO property will typically be free of liens or tax burdens. Lenders tend to remove all their liens, and pay off any remaining taxes, when they acquire the REO property after foreclosure. Thus, you can be sure that you can take complete ownership of the property when you purchase it and pay off your mortgage.
Try to negotiate with the lender for a better deal on an REO property. If you are willing to purchase the property quickly, the lender that owns the REO property may be willing to work with you to complete the sale.