Is a Bank Owned Home (REO) Safe to Buy?
Bank owned homes, usually foreclosures, are also called REO’s. REO is a term that actually means “real estate owned”, and is an old term the banks have used for years to describe the homes they have taken back in foreclosure. In the past this term was used by a very small segment of the real estate world, but as we all know now, has become (along with short sales) at least 50% of the homes now sold in the United States. Below is a short (and we think funny) video that highlights some of the things you should know about purchasing a REO or bank owned home.
We have written about Bank Owned homes for sale in the past, and now a quick update on what’s happening in the REO home sales world right now.
Now over 50% of all the home sales in San Diego and North County San Diego are either REO or short sales. As the home market deteriorated, banks confessed their wrongdoings, and people scrambled to somehow avoid a huge loss of equity, the market began to sink, stabilized, and has now come to rest on a Greek island with the water being pumped out just about as quickly as it leaks in.
The biggest difference from two years ago is that the banks have developed and staffed for the number of homes that they have taken back in foreclosure, and now they mostly list with certain real estate companies that know how the bank operates and what they will do to complete a sale of any of their homes. With that experience and staffing, REO or bank owned homes are now much easier to buy if you work with an experienced short sale and REO real estate agent. As the video above explained in brief, you still have to pay attention to what you should expect in terms of risk or lack of disclosures with bank owned homes, but with good guidance these homes are often priced at the lowest end of the market in just about any area of San Diego.
If you want to look at REO, bank owned or short sale homes, just click above on “I would like to see homes that are….“, and once you’ve picked an area, just go ahead and register. Once you’ve done that you’ll be able to select ONLY REO homes to search for, and I think you’ll find this a great tool to learn about bank owned/REO homes that may be of interest to you.
By Don Reedy