Whether To Invest On A Pre Foreclosed Or An REO Property?
If you are an investor looking to invest on a foreclosed property, then you may also want to consider whether to buy the Real Estate Owned property or the pre- foreclosed property that is still owned by the borrower. You may feel that investing on an REO property is a fairer deal as you will be assured with the title to the property and the insurance. Also you will have a security of the old owner not returning to claim back the property.
However, these features are not applicable when you buy a pre foreclosed home! But the real problem you will face when you want to invest on an REO property is the lack of REO bargains. The lenders would have rejuvenated the house and will claim full market value for it. But the amount you invest in a pr foreclosed property is less than the market value. Apart from these assumptions there are other factors that help you decide which investment is suits you the best.
When you are dealing with a lender, which is obvious for an REO property, their REO sales are now the fastest growing departments of the business. But in case of the pre foreclosed property where the sellers are underwater in debt, you will need a lender to grant permission for a short sale. Therefore, in both cases dealing with a lender is inevitable.
In a pre foreclosed deal, you can directly negotiate with the owner to get a bargain on the price. Also to keep the interest of the seller, you will need timely action from the lender. Unlike the pre foreclosure property, in an REO investment the challenge is to go early to a lender before the properties are listed. Your negotiations with the lender may succeed in getting you a bargain.
The lender who owns a REO property is well aware that it can be difficult to get financing from outside. Lender also has all the resources to handle the financing. Hence, they make the purchase subject to the seller’s finance. Looking for outside financing for a pre foreclosed property, is very difficult as lenders will not close the deal because of the foreclosed status!
However, when it comes to fixing up a property, foreclosures and REO require rejuvenations. On an average, the lenders will charge $9000 per property for repairs. Whether the property you invest on is a pre foreclosed or REO, you will have to pay the rejuvenation amount. Thus there is not much to choose between a pre foreclosure and an REO house. Each deal is distinctive and only you can decide which deal suites you the best!
For additional resources and information please visit the following sites.
Resource Links:
http://www.gmacrealestate.com
Bill Fields All Star Coaching Program: http://www.AllStarCoaching.net
GreatWest GMAC Search all MLS Listings: http://www.LocalHomeLink.com
GreatWest GMAC Consumer Buyer/Seller Blog: http://www.GreatWestBlog.com
T. Sami Siddiqui (Broker/ Owner) Buzz About Sacramento Blog: http://www.samisiddiquiblog.com
Brodie Stephens (Executive Vice President) One Stop Blog: http://www.brodiestephensblog.com
GreatWest Podcasts- Weekly Updates on new REO, Short Sale, Bank Owned Foreclosure Listings: http://www.HouseTalkOnline.com
GreatWest Videos: http://www.youtube.com/brodiestephens
Facebook Brodie Stephens Profile Page: http://www.facebook.com/brodiestephens
Facebook GreatWest Profile Page: http://www.facebook.com/searchmlshomesforsale
MySpace Brodie Stephens Blog: http://www.myspace.com/brodiestephens
MySpace GreatWest Blog: http://www.myspace.com/greatwest
Picasa Web Album: http://picasaweb.google.com/brodiestephens
GreatWest Real Estate Careers- GMAC is looking for Professional Realtors to Join Us: http://www.CareersWithUs.com
Global Employee Relocation: http://www.employeerelocation.blogspot.com
Apply for a Loan: http://www.choice1funding.com
ActiveRain Blog Brodie http://activerain.com/blogs/brodiestephens
ActiveRain Blog Companyhttp://activerain.com/blogs/greatwestgmac
Sacbeehttp://www.sacbee.com
Company WordPress Sitehttp://www.thehomeholders.com
Real Livinghttp://www.realliving.com