Buying an REO Property

Preparing an offer when buying an REO property is a bit like playing poker. The lender that owns the property, and the other people who are also interested in buying an REO home are trying to determine what the other players will do and how much they will bid on the property. The price is not set in stone, but it’s very important not to get caught up in the bidding when making an offer on an REO. Instead, it’s better to base your offer on the price that is best for you and stick to it. In most cases, the lender is sitting on multiple properties that are siphoning revenue so you have the advantage of dealing with a motivated seller. When making an offer on an REO property, you should make the offer in writing and be as specific as possible. It’s important to include:

• The address

  
  Clearly indicate the exact address of the REO property you wish to purchase and include the assigned identification number to this property. This is an easy and effective way to prevent misunderstandings.



• The purchase price

  Make sure to include the purchase price that you are offering or the lender will not take your offer seriously.




• The financing terms

  Lenders prefer that REO buyers have all their financing in order so that the sale progresses smoothly. So make sure to include the financing terms, interest rate, and the amount you are borrowing as well as the length of the mortgage.
  

  continued...› | 6/30/2009